{"id":208642,"date":"2022-04-08T11:33:14","date_gmt":"2022-04-08T18:33:14","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=208642"},"modified":"2022-04-08T13:26:01","modified_gmt":"2022-04-08T20:26:01","slug":"macau-outlook-credit-rating-encouraging-notes-fitch-ratings","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/","title":{"rendered":"Macau Retains \u2018AA\u2019 Credit Rating, Fitch Sees Recovery Gaining Speed"},"content":{"rendered":"

Macau\u2019s rebound is still slow-moving at best. But the special administrative region\u2019s (SAR) strong credit grade remains intact with Fitch Ratings, affirming the world\u2019s largest casino center at \u201cAA\u201d with a \u201cstable\u201d outlook.<\/p>\n

\"Macau
The Cotai Strip in Macau, seen above. Fitch Ratings is optimistic about economic recovery there. (Image: Bloomberg<\/em>)<\/figcaption><\/figure>\n

Fitch\u2019s view on the only Chinese territory where legal gambling is encouraging. But it arrives as the SAR\u2019s once lucrative junket business<\/a> is all but dead and as shares of the six concessionaires are extending lengthy slumps. Still, the ratings agency sees the potential for significant upside to Macau\u2019s 2022 GDP growth.<\/p>\n

Fitch forecasts Macau’s economy will expand by 19% in 2022 based on our assumption that gaming revenue will recover to about 44% of its pre-pandemic level,\u201d<\/strong> said the research firm.<\/p><\/blockquote>\n

Interestingly, Fitch\u2019s call on Macau arrives soon after rival ratings agencies downgraded some of SAR\u2019s operators. In February, Standard & Poor\u2019s \u00a0lowered its grades<\/a> on Las Vegas Sands (NYSE:LVS) and the operator\u2019s Sands China unit to \u201cBB+,\u201d or one notch into junk territory, from \u201cBBB-.\u201d Last week, Moody\u2019s Investors Service pared its grade on MGM Resorts International\u2019s (NYSE:MGM) credit rating to \u201cB1\u201d from \u201cBa3.\u201d That company owns 56% of MGM China.<\/p>\n

China Policy Hindering Macau Recovery<\/h2>\n

Other casino markets are moving past the headwinds created two years ago by the coronavirus pandemic. But Macau isn\u2019t in that camp.<\/p>\n

\n

Integrated resorts there are open, but getting tourists to the SAR is a different matter. The Chinese Communist Party (CCP) has a zero-tolerance stance on COVID-19, and amid a recent spike in cases in Shanghai, the CCP is employing draconian lockdown measures, making one of Asia\u2019s largest cities look like it did in April 2020.<\/p>\n<\/div>\n

Citizens there can\u2019t even leave their homes to go grocery shopping, let alone hop on a plane to go gambling in Macau.<\/p>\n

\u201cWe expect the territory to maintain its \u2018zero-Covid\u2019 strategy in line with mainland China – the dominant tourism source market – to prioritise the return of mainland tourists,\u201d adds Fitch. \u201cThe recent Covid-19 Omicron variant flare-ups in parts of mainland China and precautionary travel restrictions point to a more volatile near-term visitation recovery trajectory.\u201d<\/p>\n

Optimistic About Second Half Recovery<\/h2>\n

Fitch is forecasting a rebound in gaming activity in the second half of this year. That\u2019s music to the ears of Macau policymakers and the concessionaires themselves because they\u2019re burning through large amounts of cash<\/a> to simply keep casino doors open.<\/p>\n

\u201cThe gaming tourism recovery should pick up momentum in 2H22, underpinned by a gradual resumption of inbound tourism from mainland China. We project growth will accelerate to 24% in 2023, as visitation normalizes further,\u201d says the research firm.<\/p>\n

That forecast largely hinges on either COVID-19 case counts decreasing in mainland China or the CCP realizing its zero tolerance policy is a futile endeavor.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Macau\u2019s rebound is still slow-moving at best. But the special administrative region\u2019s (SAR) strong credit grade remains intact with Fitch Ratings, affirming the world\u2019s largest casino center at \u201cAA\u201d with a \u201cstable\u201d outlook. Fitch\u2019s view on the only Chinese territory where legal gambling is encouraging. But it arrives as the SAR\u2019s once lucrative junket business […]<\/p>\n","protected":false},"author":46,"featured_media":208643,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[69069,62],"tags":[],"acf":[],"yoast_head":"\nMaca Outlook, Credit Rating Encouraging Notes Fitch Ratings<\/title>\n<meta name=\"description\" content=\"Fitch Ratings sees Macau on pace for rapid GDP growth in second half of this year.\" \/>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Maca Outlook, Credit Rating Encouraging Notes Fitch Ratings\" \/>\n<meta property=\"og:description\" content=\"Fitch Ratings sees Macau on pace for rapid GDP growth in second half of this year.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2022-04-08T18:33:14+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-04-08T20:26:01+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/04\/cotai.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/\",\"url\":\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/\",\"name\":\"Maca Outlook, Credit Rating Encouraging Notes Fitch Ratings\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/04\/cotai.jpg\",\"datePublished\":\"2022-04-08T18:33:14+00:00\",\"dateModified\":\"2022-04-08T20:26:01+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Fitch Ratings sees Macau on pace for rapid GDP growth in second half of this year.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/macau-outlook-credit-rating-encouraging-notes-fitch-ratings\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/04\/cotai.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/04\/cotai.jpg\",\"width\":1200,\"height\":800,\"caption\":\"The Cotai Strip in Macau. Fitch Ratings is optimistic about economic recovery there. 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Todd got his start in financial markets as a reporter with Bloomberg News. Later, he became a trader at a Southern California-based long\/short hedge fund, where he specialized in the trading sector and international ETFs leading up to and during the financial crisis. He joined Casino.org in 2019. Currently, Todd analyzes, researches, and writes on ETFs for various web-based publications and financial services firms. Shriber has been featured and quoted in Barron's, CNBC.com, and The Wall Street Journal. His work can also be found on Benzinga, ETF Daily News, ETF Trends, MarketWatch, Fox Business, and Nasdaq.com. He currently resides in Las Vegas, where he enjoys golf and taking his black lab to the dog park. He's also an avid sports fan and likes to wager on college football and the NBA. You can also find him at the three-card poker and roulette table, even though he knows better. 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