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Macau Casinos Stock Soar after Guangdong Eases Border Point Restrictions
By Jeff Osienya Jul 16, 2020 IndustryGaming properties in Macau breathe a sigh of relief after Guangdong agrees to relax its mandatory quarantine protocols at the borders. Tight health and safety measures are however still in place to prevent the spread of the virus.On Monday, the governments of Guangdong and Macau released a joint statement announcing that they would lift the mandatory 14-day quarantine at Macau-Guangdong border checkpoints for any visitors returning from the gambling Mecca to Guangdong province. The relaxation of the quarantine rules that were active since late May will be effective starting at 6:00 am on Wednesday, 15th July, so that gamblers can have an easier time crossing the border from Macau.
Guangdong is the most populous province in China and it is also the closest geographical region to Macau – making it the biggest source of customers for Macau casinos. Consequently, the stringent 14-day quarantine requirements of individuals coming to the mainland from the world’s gambling capital ended up costing the gaming properties a lot of business. Only 4,537 visitors arrived in Macau in May, a staggering disappointment, compared to 1.1 million visitors over the same period last year.
Overall, the casino properties in the area accrued nearly $90 million in June, an astounding 97% decline year on year. This was the largest year-over-year monthly revenue nosedive since the pandemic crisis hit the Special Administrative Region.
Macau Casino Stocks Surge
After China’s Guangdong province disclosed its plans to officially lift the quarantine requirements for travelers coming from Macau, the markets reacted in an overwhelmingly positive trend.
On Tuesday, the Galaxy Entertainment Group closed at HK$54, gaining over 6.2% after shooting by over 11.1% earlier in the day. Sands China which is one of the most dominant brands in the high flying Cotai Strip of Macau also experienced impressive gains, jumping by up to 8.9% then closing at HK$32.35 which was 5% more than market opening prices.
Other Hang Seng Index heavyweights like Wynn Macau Limited also soared by as much as 16% on Tuesday, to make it one of its best days in nearly a decade! Similarly, the likes of Melco International Development Ltd and SJM holdings recorded significant numbers, rising by at least 6% on the same day.
Strict Health & Safety Measures are Still in Play
Even with the easing of the 14-day quarantine at the border checkpoints, the Guangdong government is still vigilant in its fight against the novel virus. All visitors coming to the province must provide a negative test result of COVID-19 from an approved testing facility, and the visitors will still have to apply for entry into Guangdong no less than 24 hours before arrival.
But then again, the initial quarantine requirements will still apply to people who either display Coronavirus symptoms or are contact persons of patients infected with the virus. Individuals who have traveled abroad 14 days before coming to Guangdong will also have to undergo the mandatory quarantine.
Guangdong residents coming back from Macau aren’t allowed to leave the province for 14 days and during that period, they’ll have to submit health status updates to the authorities every day. Non-residents who arrive from the gambling capital will also be required to stay in any of the nine cities in Guangdong for 14 days.
Likewise, officials in Macau also announced that anyone who plans to enter local casinos will have to provide a nucleic acid test certificate and a valid green health code. Thus, while the movement is going to be easier, it still doesn’t mean that gamblers can still pop in and out of Macau as they did in say the same time last year.
On the bright side, however, the relaxation of the mandatory quarantine could shine some light on the gaming hub. Besides, analysts of the Chinese gaming industry are already predicting that the return of travelers to Macau after the borders reopen could bump up the gross gaming income to highs if $1 billion per month.
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