Casino gambling revenue in Macau, the world’s biggest gambling hub, almost doubled last month, according to a person familiar with the information.

Gambling revenue for the city’s casinos in May rose to about 17 billion patacas ($2.12 billion) from 8.8 billion patacas a year earlier, according to the person, who requested anonymity because the data isn’t public. The total for the five months through May rose to about 72 billion patacas from 43 billion patacas a year earlier, the person said.

Growth is accelerating for casinos in the only Chinese city where they are legal on more wagers at baccarat tables with minimum bets of 10,000 patacas or more. Macau gambling revenue surged 57 percent in the first quarter to about 41 billion patacas as China’s economic growth accelerated to 11.9 percent, the fastest pace in almost three years. Macau’s government doesn’t release monthly figures.

“The strong growth for gaming revenue seems to come from more VIP versus mass” gambling, Huei Suen Ng, a Hong Kong-based analyst for CLSA Ltd., said in a note to clients today. The trend will favor casino operators who target VIP gamblers, or those who play at high-limit tables where bets can go up to as much as 2 million patacas per hand.

The casino companies with “larger VIP exposure” are Wynn Macau Ltd., Melco Crown Entertainment Ltd., and Galaxy Entertainment Group Ltd., the CLSA analyst said.

Wynn Macau gained 2.2 percent to HK$12.76 at 11:53 a.m. in Hong Kong while Melco International Ltd., one of the partners that control Melco Crown, rose 1.9 percent to HK$3.16, and Galaxy advanced 1.7 percent to HK$3.68.

Market Share

Billionaire Stanley Ho’s SJM Holdings Ltd. has the highest market share among Macau casinos with 32 percent, according to CLSA’s estimates, followed by Sands China Ltd. with about 20 percent and Wynn Macau with 16 percent. Melco Crown had 14 percent, Galaxy had 11 percent and MGM Mirage had 7 percent, according to CLSA.

Macau surpassed the Las Vegas Strip as the world’s biggest gambling hub in 2006. Bettors wagered a record 119 billion in Macau’s casinos last year, 9.7 percent higher than in 2008.

Source: www.businessweek.com

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