China capital controls may weigh on Macau VIP sentiment: CreditSights

Credit and market research provider CreditSights Inc says it “does not rule out” the possibility of “tighter regulatory scrutiny remaining an overhang” for the Macau gaming sector, mainly by dampening sentiment in the VIP segment. Tighter scrutiny was “likely to have a more secondary effect, i.e., dampened high roller sentiment, rather than a direct GGR [gross gaming revenue] impact given that funding channels for gambling in Macau are already subject to strict controls,” wrote analysts Nicholas Chen and David Bussey wrote in a Monday memo. They suggested that Chinese government rules on outbound investment by individuals, which took effect in July and cover investments in Hong Kong and Macau, “may have weighed down on punter sentiment” during August. GGR in Macau fell 1.2 percent year-on-year in August, to just over MOP21.89 billion (US$2.71 billion), showed data released by the city’s Gaming Inspection and Coordination Bureau. That had meant the city “slightly missing market expectations” in terms of a consensus forecast of 1 percent year-on-year gain for August GGR. But the CreditSights team said that a “slate of high-profile concerts” scheduled across Macau gaming resorts in the remainder of the second half this year was likely to “provide demand support going forward”. The analysts mentioned the acts ITZY, a South Korean girl group; Donghae a member of South Korean boy band Super Junior; Canadian artist Henry Lau; and South Korean girl group i-dle, as examples. Casino GGR for the first eights months of 2026 “was still up by 4 percent year-on-year while the average monthly GGR figure was still above pace” to reach the Macau government’s 2026 GGR target of MOP236 billion, “72 percent of which has been reached as of August”, noted the CreditSights team. The institution observed August visitor arrivals grew by circa 6 percent year-on-year “to a new record” for that month, amounting to circa 4.5 million, or 123.6 percent of pre-pandemic levels seen in August 2019. Nonetheless, the tally of overseas visitors and those from Hong Kong and Taiwan had all declined in August. Analysts have often noted that Macau visitor volume may not be a proxy for GGR, as many visitors are not casino gamblers. CreditSights said that on a purely arithmetic basis, dividing the total of August GGR by the number of that month’s visitors, “GGR per visitor decreased by 7 percent year-on-year to MOP4,888… which implies fewer casino-goers during the visitor mix and/or a smaller proportion of higher spending punters within the player mix.” CreditSights also noted that month-on-month, the August GGR per visitor was down 14.5 percent on July’s MOP5,720 average. “We continue to see a difficult path for gaming spending per capita to meaningfully recover,” the analysts said. They stressed that GGR per visitor was only a “proxy”, as Macau does not publish a standalone figure for gaming spend per gambler.