winvegas.co.uk, win a trip to Las Vegas. Please pass on. |
The following Symbols may be related to SPYUF:
MCIJ - MACAU CAPITAL INVESTMENTS INC
MUSBF - MACAU SUCCESS LTD |
 Raising the stakes
30/07/2007
With a total area of merely 28.6 square kilometers, Macau astonished the world last year when it overtook Las Vegas to become the world's largest single gaming center.
This followed the move by the Macau government to terminate the monopoly status of Sociedade de Jogos de Macau in 2002.
Even though the move was not applauded by Stanley Ho Hung-sun, who owns the gaming conglomerate SJM, it was good news for other gaming players, including Macau Success (0487).
Riding on the opportunities offered by market liberalization, Macau Success went for a back-door listing on the Hong Kong bourse in 2003 by acquiring stakes in a loss-making company called China Development Corp, executive director Hoffman Ma Ho-man recalled.
Despite having "Macau" as part of the company's name, it did not have direct exposure to the fast-growing Macau gaming market. But this will change when Ponte 16, a flagship project it owns and operates, is launched.
It beat other competitors to become SJM's partner in the world's largest gaming center.
Back in the 1990s, Sonny Yeung Hoi-sing, chairman of Macau Success, was already involved in the gaming business in Macau. He was the operator of Golden Palace, a VIP room, in SJM's Casino Lisboa, Ma said.
"As one of the top three VIP room operators and having a good business relationship with SJM, Yeung was invited to be a partner," he added.
Ponte 16 then became the core business for Macau Success.
Initially, it only held 10 percent shares in Ponte 16, but gradually lifted its stake to 49 percent by December 2006 after several share placements, including a HK$370 million share placement in November 2004; selling 5.6 percent of shares to Joy Idea Investments, a VIP room operator in Macau, as strategic investors in 2006.
With the shareholders' structure settled, Ponte 16 is ready to launch its operations.
But the competition is severe.
There are 26 casinos operating in Macau, more than double the 11 casinos in 2002. There are a total of 3,102 gaming tables and 8,234 slot machines, eight times and nine times more than 2002, respectively, according to data from Macau's Gaming Inspection and Coordination Bureau.
While more casinos are in the pipeline, including The Venetian, the second project for Las Vegas Sands, and the MGM Grand Paradise, both of which will both this year, market competition is intensifying.
Analysts generally believe the average net revenue per table will continue to decline in 2007 and 2008.
Morgan Stanley believes a recovery in revenue per table will not happen until 2011, after hitting bottom at US$2,000 (HK$15,600) per table per day, because of the increase in casinos.
Nevertheless, Ma believes their network and know-how in the city is their advantage over the overseas giants.
"The needs and habits of mainland customers is different from that in Las Vegas," Ma said. He believes simply copying the model from Las Vegas will not be successful.
"Gamblers in Macau tend to have a larger bet and show more passion in gaming than those in Las Vegas, which leads to a smaller demand for entertainment shows or quality meals."
Rather than adopting the international Las Vegas style, Ponte 16 will make use of its geographic location to distinguish itself from competitors, Ma added.
Located at the Inner Harbor in the old town, the HK$2.4 billion integrated casino resort will feature a European Riviera theme, building on the atmosphere of the former Portuguese colony.
Ma believes the casino will benefit from the new pier to be built at Inner Harbor, which will have ferry services connected to Zhuhai and two other places in Guangdong. This would help bring in customers as the Gongbei immigration gate, which is connected to Zhuhai, is heavily congested.
"Cotai Strip will develop towards the Las Vegas style, while those casinos on the Macau Peninsula will focus on gamblers or visitors looking for the real Macau experience," he said.
The casino, which will house 150 mass-market gaming tables, 24 VIP tables and 300 slot machines, the 423-room five-star hotel Sofitel Macau@Ponte 16 and a shopping arcade will open in phases. Dates are yet to be announced.
Looking ahead, Ma is optimistic.
"Underpinned by the robust economic growth of China and Asia, the prospects of Macau's gaming market will definitely outpace Las Vegas," he said. "In a market growing at over 20 percent per annum, I am very optimistic about the future."
Eyeing a 6 percent to 10 percent market share in Macau's gaming market by revenue, Ma hopes to recoup the investment on Ponte 16 within three years. He is hoping for an opportunity to develop a second casino project.
Sharon Wong of Standard & Poor's expects net profit of Macau Success to be HK$12 million for the year ended September 30, 2007, the lowest since it listed in 2003, because of the absence of interest income from the King Seiner Palace Promotor loan.
However, she expects its net profit to surge to HK$205 million in fiscal 2008 once the Ponte 16 comes onstream.
/see: |
/from GEI:
Despite Macau boom, Developers could hit bumps... / says Asian Wall St. Journal
- Only 2,000 of the 87,000-odd foreigners living in Macau can afford some of the luxury apartments coming on the market in the next two years
- Speculators ("sales by confirmer"?) now make up 28% of total property tarnsactions vs. 2% in Hong Kong
- 5,704 units will be completed in 2009, more than double the 2,710 expected in 2008
- Prices have already gone up so much, "who can afford?" ask local property agents. Buying into the new luxury
.. units might "mean spending 70 cents out of every $1 of income" on the mortgage
Brokers have "sell" recommendations on: "high profile developers":
+ Shun Tak Holdings - 70% of NAV is property, mainly in Macau
+ Polytec Asset Holdings
Some remain bullish on Macu propery itself, citing:
+ higher salaries (+18%) and cheaper loans,
+ Hotel and casino openings will require 20,000 more jobs
But maybe the low end will outperform luxury, like in HK |
Macao International Trade and Investment Fair (MIF) -
..
MIF is currently the largest trade event held in Macao as well as being the only exhibition accredited by the Global Association of the Exhibition Industry (UFI) as approved event. MIF is an integrated exposition comprised of high rank political and economic forum, product exhibition, business matching, international purchasing and professional presentation. Over the years, MIF has played an active role in promoting trade and investment, economic co-operation, diverting investment, increasing imports and exports and information exchange etc.
/see: |
Energyi: I used to visit Macao and stay at the Bella Vista, but haven't been since it was revamped a few years back. Is the floating casino still in existence? |
Even made the BBC:
A rare political protest in the Chinese territory of Macau turned violent after demonstrators clashed with police. |
SHOTS FIRED AT MACAU RALLY
Bullet strikes man in the neck as police battle with angry protestors
during march against labour woes
Police fired shots in the air and beat protestors back with batons yesterday as a Labour day march by thousands in Macau erupted in violence
Incensed by a lack of jobs and low pay while mainland labour flodds in to drive Macau's casino boom - and accusing the government of corruption - the protestors mounted the most direct challenge yet to Chief Executive Edmund Ho Hau-wah, calling on him to step down.
. . .
Police put the number at 2,400, while the rally's organisers said it was 10,000 |
Macau 'to unblock N Korea funds' |
ABRUPT SUSPENSION
Macau has made an "abrupt suspension" of its investment migration scheme. The scheme allowed those who invest 1 million patacasa and depoist pt.500,000 in a Macau bank to gain permanent residency in Macau. Most applicants (90%) were from mainland china, but these were also required to have a non-Chinese passport- easily acquired for between pt.40-50k from an African country.
Applications had soared to 4,000 before the suspension; and the level was over 3,000 in 2006, compared with 800 in hong kong.
By comparsion, such right requires a minimum investment of hk$6.5 million in Hong kong.
One reason for the suspension was that critics blamed it for a property bubbl;e which has left ordinary local unable to afford property.
Observers believe a new scheme with introduced, with a higher minimum, such as pt.3 million.
It will be interesting to see what impact the suspension will have on Macau's property market |
MACAU GDP PER CAPITA - at hk$217,000 Exceeds Hong Kong's hk$213,000
(Dont believe the headlines, says Jake Van der Kamp in today's SCMP)
Macau, he says, is "a good example of a fascist economy". If you compare per capita GNP with workers wages, you see a huge difference. Using Dec.1999 as a base of 100, GDP per capita doubled to 202. Wage growth was far from this good. Mediam monthly earnings of all workers rose from 100 to 135. And for unskilled workers to only 113.
Macau, he says, remains: "grimy, squalid, poverty-stricken, and old", despite the giltter and gloss of the new casinos.
"Who really stands to reap the earnings from all this investment in casino building? ...predominantly foreigners... and those that were not foreigners are best describeed as Hong Kong residents, rather than Macanese." |
BEARISH Story on Macau Casinos in today's SCMP, entitled:
"Winning Run ends as Macau Plays tumbles"
It talks about:
+ the 22-26% falls in the main two US markers, WYNN, and LVS
+ shares in Melco have plunged as much as 40% from their Dec.19th debut on Nasdaq
+ "the shares remain hugely expensive, and investors and analsyts are worried about rising costs in Macau, underwhelming growth in visitor spending and infrastructure bottelnecks"
+ "the current trend doesnt support the massively bullish argument- that you build it, and they will come, and that each time you open a new property, you are going to see a surge in visitations from the mass-market Chines visitor
+ Despite an 18 percent rise in vistations, spending per visitor rose only 1 percent
+ Gaming revenues from the walk-in mass market appeared to be growing at a 30 to 40 percent clip, and the VIP market looked aneamic at 3 per cent
+ Important, because margins on mass-market are 35 to 40 percent, against only 10 to 15 percent on VIP business (due ti big fees paid to VIP tour organisers). However, there was an error in the data collection. The real figures were more like: 15% and 9%, respectively.
= =
THIS IS CASINOS,
But some of the disappointment is likely to spill over into the Macau property market, especially if disappointing share performance continues |
COMPARING THREE ECONOMIES
Economic Indicators : Macau : HongKong : Shenzhen
Period............. q1-q3'06: .. 2006 .: .. 2006
Real GNP........... : +15.4%: . + 6.8% : . +15.0%
Exports............ : +18.6%: . + 9.4% : . +34.1%
Tourist arrivals... : +17.6%: . + 8.1% : . +12.5%
Bank Loans OS...... : +15.2%: . + 2.7% : . + 9.9%
Unemployment rate.. : . 3.5%: ... 4.4% : ... 2.3%
Inflation rate..... : + 5.4%: ... 2.0% : ... 2.2%
Property prices.... : |
Macau Property Index - per Midland??
2002-Q4 : 103.5
2003-Q1 : 103.7
2003-Q2 : 113.2
2003-Q3 : 120.3
2003-Q4 : 140.1 + 36.5 + 35.1?%
2004-Q1 : 169.0
2004-Q2 : 179.9
2004-Q3 : 201.6
2004-Q4 : 219.1 + 79.1 + xx.x%
2005-Q1 : 230.1
2005-Q2 : 234.5
2005-Q3 : 239.9
2005-Q4 : 252.0 + 32.9 + xx.x%
'06-feb : 251.9
'06-apr : 265.1
'06-jun : 245.6
'06-aug : 263.5
'06-oct : 269.0
'06-nov : 344.8
'06-dec : 401.1 +149.1 + xx.x% |
THIS sounds rather Bearish - and needs further reflection
==================
Investment immigration programme "should be suspended"
(Fri 09 Feb 2007 07:07 )
Legislators demanded suspension of investment immigration programme, expressing concerns that apartments have become unaffordable among locals.
In interviews with daily newspaper Jornal Va Kio, Ng Kuok Cheong (吳國6124;) pointed out that land concessions with prices much lower than market values had resulted in an increased supply in real properties, while there is no increase in cash supply.
Although this should slow house price hikes, increase in Renminbi value and economic development means that capital from mainland China may target Macau properties for speculation.
Meanwhile, Kwan Tsui Hang (關翠6447;) pointed out that situation has changed since the implementation of investment immigration policy.
The original purpose of such policy was to digest the over-supplied property market. With even an old apartment unit being sold for MOP 1 million, and criteria for investment immigration also at MOP 1 million, it will only result in poor quality investments.
She also expressed concerns that Macau's social infrastructure cannot cope with the load of these new immigrants.
She said that more social and economic housing are actually needed for local people, especially young people, but easy home-buying schemes for immigrants means that inequality exists between the locals and people from outside Macau, exacerbating the dissatisfaction of locals on the Government.
Jornal Va Kio also reported that the Government is "likely" to review existing investment immigration policy.
@: |
THE SUCCESSFUL opening of the Grand Lisboa
may be what is hitting these other casino stocks |
...Morgan Stanley report said gaming revenue in the first month of the year was over HK$6 billion ($768 million) -- up 70 percent from same period a year earlier.... |
Post removed by ADVFN |
She's hot, she's hip, and she's your most gorgeous friend .... meet the Viva Showgirl .... always dressed to party, she's here to steal your heart away ... |
would like to (if I had spare funds for the trip !!) ... but it's during school term time anyway ....
I see at the expensive meal event in Bangkok recently then a Macau casino owner was amongst the paying guests... |
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