Why Macau gaming could suffer a 21-22% y/y decrease in October GGR

October has shown daily revenue stabilization, though.

In Macau gaming, it has been observed that assuming the rest of the month continues to see a range of HK$750-800 mn per day and add a slot revenue full-month assumption of HK$1.2bn, October total gross gaming revenue could be HK$27.6-27.9 bn.

According to a research note from Barclays, this would imply a 21-22% y/y decrease.

This was in light of the observation that average daily table revenues at HK$790 mn for the period 20-26 October. This was slightly better than that of the previous week (13-19 October), and up 4%.

This figure is similar to the post-Golden Week period (7-19 October) that saw HK$779 mn a day, and September average table revenues, which were also at HK$790 mn a day.

Barclays has also noted that October data so far had shown stabilization of daily revenues since September, despite the implementation of the smoking ban on mass floors starting 6 October.

Here's more from Barclays:

We expect progressive narrowing of y/y declines, and we look for November GGR to just be down teens percentage y/y.

We still expect GGR y/y declines to continue in the near-term, but we continue to look for a return to positive growth some time in 2Q15, upon new casino openings and also easier VIP base comparison.

Our top picks remain Melco, Galaxy and Sands.