Global ratings agency Fitch has predicted mid-single digit growth for the Asian gaming industry in 2019, buoyed by new and recent property openings in Macau and stability provided by the mass market sector.
Providing its outlook for the region through the next 12 months in a note this week, Fitch said its forecast reflects a “long-term positive outlook as we believe greater China, with a growing middle class, is underpenetrated.”
Contributors to GGR growth will include the opening of SJM’s Grand Lisboa Palace, the ramp-up of MGM Cotai and Morpheus tower at City of Dreams which both opened in 2018 and new infrastructure projects such as the Hong Kong-Zhuhai-Macau Bridge, it added.
However, Fitch expects the VIP sector to continue its recent slowdown into 2019 with mass market to continue its trend “as the primary growth driver over the past few months.”
“We expect this trend to continue into 2019 as VIP is more sensitive to the economic and credit conditions on mainland China. We expect Chinese-related VIP weakness to spill over into other markets including Singapore and Las Vegas Strip,” Fitch said.
Discussing Singapore specifically, where GGR declined 3% year-on-year in 1H18 after growing 14% in 2017, Fitch said, “The recent weakness is largely driven by the VIP segment, which is slowing across the region and facing increased competition from expansions in Philippines and other newer markets.
“We expect VIP weakness to carry into early 2019 and the full-year 2019 to be about flat, offset by a stable mass market.”
