Although Macau casino stocks have lost as much as half their value over the past year as China's anti-corruption crackdown scares away high rollers, some investors say their faith in long-term demand from the mainland remains in place.
Casino revenues slid in April for an 11th straight month. Industry moguls like Wynn Resorts' Steve Wynn and Las Vegas Sands' Sheldon Adelson have noted the unprecedented nature of the decline and a highly uncertain near-term outlook.
High rollers now account for around 60 per cent of Macau's gambling revenue, down from 80 per cent two years ago. Among Hong Kong-listed stocks, those hit hardest include SJM Holdings, which has fallen 54 per cent over the past year while Wynn Macau has tumbled 45 per cent.
However, those taking the longer view point out that less than two per cent of China's 1.4 billion people have visited Macau, the only place in the country where casino gambling is legal, and that a planned extension of a high speed rail network will slash travel time to the enclave in the coming years. Development of a neighbouring island will also help boost visitors.
Galaxy has doubled its presence with the opening of a new multi-billion dollar casino in May, while Sands China's casinos have been designed to cater to ordinary punters who are expected drive future growth.
Macau's capacity expansion will also not stop with the new Galaxy casino. Melco Crown Entertainment is set to open a film-themed casino resort this year and another three casinos will open in 2016 - developments widely seen as helping unleash pent-up demand.
