Bloomberg – When Li Yu wanted to take a gambling trip, she looked into Macau but found the hotels too expensive. So she booked a room on an overnight casino boat that sailed about an hour from Hong Kong into international waters before opening up its baccarat tables.
“I don’t care about the food or other amenities, my sole purpose is to gamble,” said Li, a housewife from nearby Guangzhou who played into the early hours of the morning with about 70 others in the ship’s cramped casino. “It’s way cheaper than going to Macau.”
Surging demand from mainland China has made Macau the world’s largest gambling hub, pushing hotel prices above those in Las Vegas. Lower costs, less government scrutiny and easier visa requirements are encouraging some China bettors to turn to gambling boats as an alternative to Macau’s glitzy casinos, which drew $38 billion in revenue last year.
Visitors on the eight casino boats that leave Hong Kong each night rose 9 percent to 615,328 in the first half of this year, aiding operators such as Success Universe Group Ltd. (487) and Genting Hong Kong Ltd. (GENHK)
“The cruise ship can be a good substitute for mainland tourists,” said Hoffman Ma, deputy chairman of Success Universe, which doubled profits from its casino ship to HK$2.15 million ($277,000) in the first half of this year.
Success Universe shares rose 6.8 percent in Hong Kong trading today, boosting its gains for the year to 54 percent. The benchmark Hang Seng Index climbed 1.5 percent today.
The ships’ popularity shows how new businesses are profiting as Macau struggles to keep up with accelerating demand. The city, across the Pearl River Delta from Hong Kong, is half the size of Manhattan and drew about 14 million tourists in the first half of this year.
