Macau casino shares soar as China resumes e-visas

HONG KONG shares in Macau casino operators went up to 13 per cent on Monday after the city leader said China would resume an e-visa scheme for mainland travellers and permit group tours, which could boost the footfall in the world's biggest gambling hub.

The Chinese special administrative region, which is the only place in the country where citizens can gamble in casinos, will open to mainland tour groups in November for the first time in almost three years, the city's chief executive Ho Iat Seng said on Saturday.

Since 2020, Macau, a former Portuguese colony, has implemented stringent COVID 19-pandemic restrictions with tight border controls, resulting in a major impact on its casino industry.

The announcement came earlier than expected, analysts said, who had been expecting such measures to be introduced early next year. Mainland gamblers account for about 90 per cent of total casino revenue.

Although it's hard to quantify the immediate benefit, we believe the resumption of e-visas and group tours should help alleviate friction for a Macau trip, as well as signal to many that it's okay to visit, said DS Kim, an analyst at JP Morgan in Hong Kong.

We feel that we can talk about a return to normalcy. Sands China climbed more than 13 per cent, Wynn Macau climbed 7 per cent, Galaxy Entertainment advanced 10 per cent while SJM and MGM China jumped 8 per cent each.

While the border between Macau and the mainland has been open for two years, traffic remained sluggish due to the lack of e-visas that were readily used by Chinese gamblers prior to the epidemic to make instant bookings.

Currently, Chinese tourists to Macau need a visa appointment, followed by a week-long approval process. The visa scheme accounted for around 50 per cent of Chinese visitors to Macau in the year 2019 while tour groups accounted for around 25 per cent of visitation.

In the first phase, tour groups will come from five provinces - Guangdong, Shanghai, Zhejiang, Jiangsu and Fujian - which represented almost 60 per cent of mainland visits to Macau in 2019.