Fool.com.au – After almost eight years of steady casino development in Macau and 33 casinos now in operation, a new report by Citi Group says that no major casino opening is planned until mid-2015. Those already established will be better positioned to grow earnings, based on larger numbers of tourists and gamblers arriving at the Asian gambling mecca.
Crown Resorts (ASX: CWN) and its joint venture Melco Crown has three casinos operating in Macau under its “City of Dreams” integrated resorts brand. The largest casino operator, SJM Holdings, has 20 under the control of gambling king Stanley Ho.
The pause in new openings will be welcomed as the island’s gambling obsession is projected to bring in $54 billion in gross gaming revenue in 2014, 20% more than the $45.2 billion raked in during 2013. According to Citi’s report that was about seven times more than the Las Vegas Strip earned last year.
The bank’s report noted that Melco Crown was one of the top-three stock picks among the Hong-Kong listed resorts, and further added that the company’s Studio City was the best-located casino in Cotai. It’s located just next to the Lotus Bridge border with the best access to Hengqin Island. The island is a popular tourist resort that is expected to attract 20-million visitors a year when the Chimelong International Ocean Resort, a theme park and man-made beach, opens this month.
Citi forecasts that Melco Crown has a 37% upside over the next 12 months. Crown Resorts owns a 33.7% stake in Melco Crown. Melco Crown is scheduled to open its Manila “City of Dreams” in mid-2014 and has further plans to develop casinos and integrated resorts in locations such as Sri Lanka.
Crown Resorts is moving forward with its development of a second gambling venue to open in Sydney at the Barangaroo development site at Darling Harbour. The intention is to host a 6-star hotel with VIP gaming facilities, apartments, bars and restaurants.
More casino venues here and abroad could mean more business for Aristocrat Leisure and Ainsworth Game Technology, both Australian-based gaming machine manufacturers.
