Asia Emerges As A Lucrative Destination For Casino Operators

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Wynn Resorts
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The casino industry in Asia has witnessed impressive growth especially in the past couple of years. The Macau region surpassed the Las Vegas Strip as the world’s biggest gambling hub in 2006, after the government allowed the entry of overseas casino operators. The Asian presence also lends a diversified revenue stream for casino operators as it is relatively safeguarded from global economic volatility. Prominent casino operators including Las Vegas Sands (NYSE:LVS), Wynn Resorts (NASDAQ:WYNN) and MGM Resorts International (NYSE:MGM) have been focusing efforts on Asia for future growth.

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Growing importance of Asian casino industry

Macau

Macau has gained paramount importance in the gaming industry. In 2011, it collected $33.5 billion in gaming revenues, more than five times the gaming revenues collected from Las Vegas. According to a study by PricewaterhouseCoopers, Macau’s growth is expected to more than double to $62.2 billion between 2010 and 2015. [1]

All prominent casino operators are focusing on strengthening their presence in this region. Recently, Wynn got approval for its casino on the Cotai strip. [2] In April, LVS launched the first phase of its Sands Cotai Central resort on the Cotai strip. (See our previous post: LVS Expands In Macau With Sands Cotai Central)

Singapore

The casino industry in Singapore has shown robust growth since the government legalized gambling in 2009. Presently, there are only two casino operators in Singapore, LVS and Genting Singapore, which generated more than $6 billion in revenues in 2011. [3]

Other upcoming regions

The Asian regions including Japan, Korea, Taiwan and Vietnam have drawn the interest of gaming companies. MGM Resorts International together with Asian Coast Development is opening the first integrated resort in Vietnam in 2013. LVS has also expressed interest in having a presence in India, the world’s second most populous nation. In December, there were reports that LVS is contemplating building a $2 billion tourism complex in Ho Chi Minh City in Vietnam. (See our previous post: Las Vegas Sands Looks at Vietnam as its Next Asian Tiger)

A burgeoning middle class and rapid infrastructural development in Asia could dynamically boost the future of the Asian casino industry.

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Notes:
  1. PwC’s Global Gaming Outlook to 2015, Casino Enterprise Management []
  2. Wynn Macau gets approval for new Casino on Cotai strip, BBC News []
  3. See: Gaming in Asia, Casino Enterprise Management []
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