Macau Monthly
March - Impressive market
growth continues
Karen Tang, MA
Research Analyst
(852) 2203 6141
karen.tang@db.com
March gaming revenues strong, +60% yoy
Our local checks suggest April MTD is tracking strong, following exceptional
growth in March, when Macau gaming revenue hit US$1.3bn. March was the
second-highest month on record, benefiting from MGM Grand’s opening and
credit injection by AMA, the junket aggregator. For March, MPEL’s market share
edged up to 18-19%, partly due to lucky hold (3.6%). We estimate LVS lost a
couple of ppts, while Wynn and Galaxy edged down 1-2ppt. MGM was stable at
8%. The last operator regained some of its earlier loss and was just shy of 30%.
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DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1

Our channel checks suggest Crown rolled almost HK$51bn in March. We think
MPEL, Melco's 38% associate, will deliver a notable 1Q when results come out in
mid-May. Last month, we raised MPEL’s 1Q EBITDA forecast by 43% to US$70m,
the highest on the Street, given solid rolling and high hold %. We reiterate Buy on
Melco as a strong operator with potential market share gains.
Key company news – Galaxy market share losses hurt earnings; d/g to Hold
Galaxy has taken a hit not only from market share loss but also margin squeeze. Its
market share dropped from 15% in Q4 to an estimated 10% in 1Q. Our channel
checks suggest that StarWorld raised junket commissions again. We expect FY07
results (out on April 18) to be weak, especially after normalizing for 4Q’s lucky
hold. Hence, earlier this month, we cut forecast by 16-23% and downgraded the
stock from Buy to Hold. With a six-month view, we prefer Melco to Galaxy.
Key sector news – Progress on infrastructure upgrades unveiled
A project proposal for Macau-Taipa undersea tunnel to decongest traffic has been
submitted to the government and is awaiting approval. For the HK-Macau-Zhuhai
Bridge, the proportions of funding were determined by the degree of potential
economic benefits for each city. Infrastructure support is a key macro risk on
Macau. Upgrades are required to handle the glut of new supply over 2008-2012

[此贴子已经被作者于2008-4-27 17:34:34编辑过]