Paradise VIP growth “encouraging”

South Korea’s Paradise Co., which operates foreigner-only casinos, reported that Chinese VIP volume gained 1 percent in September in the first gain in 24 months in a promising sign for the recovery of the VIP market, Union Gaming says.

“While not exactly apples-to-apples given that Chinese VIP gamblers in Korea tend to be of much lower value than Chinese in Macau, we are encouraged that any established market is beginning to see growth in Chinese VIP,” the firm wrote in a note.

While Macau has improved and may be on the verge of VIP growth on the back of new property openings, Union Gaming said it remains cautious in its outlook.

It expects 2017 VIP GGR to decline 4 percent, though with some “modest” growth coming through in the second half of the year.

Part of the reason for the caution is the shifting junket market, with operators seeking to take clients out of Macau to countries offering higher commissions, but also seeking to transition their business models to become operators themselves.

Union Gaming says that Suncity, which has the biggest market share among Macau’s junket operators, saw a significant increase in volume over the first few days of the Golden Week holiday, further boosting its dominant position.

“We’re separately hearing that most other junkets are experiencing much more muted play levels this holiday. This is not overly surprising to us as we expect Suncity to keep getting bigger – often at the expense of its closest rivals.”