Shares of Macau casino operators rose up to 13% on Monday after the leader of the city announced that China would restart its e-visa program for mainland visitors and allow group tours, which is anticipated to increase tourism to the largest gambling market on earth.
According to the city’s chief executive Ho Iat Seng, the Chinese special administrative region—the only area in the nation where it is permissible for residents to gamble in casinos—will aim to reopen to mainland tour groups in November for the very first time in nearly three years.
Since 2020, Macau, a former territory of Portugal, has imposed harsh COVID-19 pandemic prohibitions with tight border security, having a significant influence on its casino business. The statement came sooner than expected, according to analysts, who had predicted that such restrictions wouldn’t be implemented until the beginning of next year. 90% or so of all casino revenue comes from gambling from the mainland.
“Although it’s tough to quantify the immediate benefit, we believe the resumption of e-visas and group tours should alleviate friction for a Macau trip, as well as signal to many that it’s okay to visit. Finally we feel we can talk about a return to normalcy ” said DS Kim, an analyst at JP Morgan in Hong Kong.
Shares of Sands China (1928.HK) jumped by more than 13%, Wynn Macau (1128.HK) increased by 7%, Galaxy Entertainment (0027.HK) increased by 10%, while SJM (0880.HK) and MGM China (2282.HK) each saw an 8% increase in share price.
Although the boundary between Macau and the mainland has been open for two years, traffic has remained slow since there aren’t any e-visas, which Chinese gamblers frequently used to make immediate reservations before the outbreak.
Chinese visitors to Macau currently have to schedule a visa appointment, which is followed by a weeklong approval procedure. About 50% of Chinese visitors to Macau in 2019 came on individual visas, compared to 25% who came as part of tour groups. Five provinces — Guangdong, Shanghai, Zhejiang, Jiangsu, and Fujian — which accounted for almost 60% of mainland trips to Macau in 2019 will resume hosting tour groups in the first phase.