Arrears warning for Macau gambling market
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Morgan Stanley warns that the combined debt of the six licensed casino operators in Macau could exceed $25 billion by the end of this year. The financial services giant also claims that it could reach $27 billion in liabilities by 2023.
Morgan Stanley analysts Gareth Leung, Thomas Allen and Praveen Choudhary believe that China's border controls will continue until the second half of 2023.
Morgan Stanley has warned that Macau's gambling market is in a lull. Macao is home to over 40 casinos operated by MGM China Holdings Limited, Galaxy Entertainment Group Limited and Melco Resorts and Entertainment Limited. The group slashed its aggregated 2022 earnings before interest, tax, depreciation and amortization forecast for these six firms by 29%.
Morgan Stanley analysts advise investors that every Macau casino operator except SJM Holdings Limited will sustain their first-quarter cash burn rates over the course of the next two years. The forecast includes capital investments, current available funds and undrawn liquidity.
