Should Thailand move forward with plans to potentially be the next hot Asia-Pacific gaming market, it could pilfer revenue from entrenched competitors, such as Malaysia and Singapore.
That’s the call from Maybank IB Research. It notes casino resorts in Thailand would not only energize that country’s tourism industry, but likely compel some Chinese tourists to visit the Southeast Asian country over Malaysia and Singapore. They added that the latter is more vulnerable than the former.
We would expect many Chinese to visit Thai IRs over the Singaporean ones should Thailand proceed to liberalize its IR industry. Thailand is already very popular with Chinese tourists even without IRs currently,” wrote Maybank analyst Samuel Yin Shao Yang in a recent report.
Thai policymakers are considering the issue of regulated casino gaming in their country to drive more tourism and to put a damper on rampant black market betting there. However, it could be a while before there’s a final decision on the matter, and it’s likely to be years before an integrated resort opens in the country.
Operators Interested in Thailand Casinos
Owing to the country’s established reputation as a popular Asia-Pacific tourist destination, it’s not surprising that some gaming behemoths are already interested in Thailand.
Las Vegas Sands recently confirmed it’s part of that group, and it’s believed MGM Resorts International, among others, has its eyes on the country. Assuming Maybank’s forecast regarding Singapore’s potential vulnerabilities to a Thai integrated resort are accurate, Sands’ Thai designs are all the more practical because the company operates Marina Bay Sands — one of the city-state’s two casino hotels.
Maybank noted that in 2019, the last year before the coronavirus pandemic, foreign tourists accounted for as much as 75% of visits to Marina Bay Sands and Resorts World Sentosa. As such, the research firm estimated that as much as 5% of the gross gaming revenue (GGR) those two venues generated from Chinese tourists in 2019 could be at risk. That’s if Thailand becomes home to comparable gaming properties.
“We do not expect many Malaysians and Indonesians to visit Thai IRs over the Singaporean ones, should Thailand proceed to liberalize its IR industry due to deep personal and commercial ties between the 3 countries,” added Yin.
Why Thailand Casinos Matter
As Sands CEO Rob Goldstein noted on the company’s fourth-quarter earnings conference call last month, there’s not much happening on the gaming front in Japan, and South Korea isn’t an appealing market for an operator of Sands’ stature, leaving Thailand as arguably the most compelling, undeveloped Asia-Pacific gaming destination.
If the time comes to deal directly with gaming companies, Thai authorities could have ample leverage, because Macau is closed to new competitors for at least another 10 years. The duopoly held in Singapore by Marina Bay Sands and Resorts World Sentosa lasts for multiple decades.
With US operators looking to expand their geographic footprints while exercising selectivity in accomplishing that objective, Thailand stands out as a logical destination. That status puts the government there in an enviable negotiating position.
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