Salient to Investors:

Salman Niaz at Goldman Sachs Asset Mgmt said:

  • Macau casino bonds will withstand any crackdown aimed at cleaning up the industry.
  • Previous cooling and policy measures have generally been positive to the long-term health of the market, and the high free-cash flow generated by operators and limited leverage means their credit profile is unlikely to deteriorate materially near term.
  • The recent noise about regulatory changes may reduce growth expectations but has less impact on credit – further efforts to improve controls, transparency and fair practices would be long-term positive for the market.

Edmund Harriss at Guinness Atkinson Asset Mgmt said the Macau businesses are attractive from a bondholder’s view, are highly cash generative and have a substantial expansion in tables, etc underway, while crackdowns go the industry.

Kevin McSweeney at CI Investments said crackdowns have made headline risks but only moderately restrain the fundamental story. McSweeney said Macau is an ever-growing hub, and cash flow at these levels of gaming supply is excellent and pricing power a tailwind.

Grant Govertsen at Union Gaming said the trends on the ground are very strong, certainly with the mass market, and visitations and gaming levels are robust – revenue will climb to as much as $44 billion in 2013.

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