* Revenue of 7 pct higher than analyst estimates of 0-5 pct
* Revenue gains come after two new casino openings
* Analysts wary of sustainability of uptick
* VIP growth due to new credit issued
HONG KONG, Oct 1The world's biggest casino hub
of Macau posted a better than expected 7.4 percent rise in
gambling revenue in September, marking the second consecutive
month of growth after more than two years of decline, as new
resorts spur spending in the southern Chinese territory.
Multi-billion dollar casino openings by Sands China Ltd
and Wynn Macau Ltd helped attract VIP
customers whose numbers have dwindled in the former Portuguese
colony since the start of 2014 when the government began a
campaign against shows of wealth by public officials.
A specially administered region of China, Macau is the only
place in the country where casino gambling is legal. Revenue has
fallen to five-year lows but has ticked up since the openings in
August and September.
Gambling revenue in September was 18.4 billion patacas ($2.3
billion), government data showed on Saturday. The forecasts were
higher than analyst estimates, which ranged from unchanged on
the year to a 5 percent rise. While growth edged up from last
month's 1 percent, overall revenue was still relatively muted.
Analysts said the boost was due to casino credit being
extended to wealthy gamblers to encourage big betting in the new
properties, but they questioned how long the uptick would last.
"We are concerned with the sustainability and quality of the
gross gaming revenue improvement," said Nomura analyst Richard
Huang. Revenue from mass market players had failed to grow
significantly and new increases were from low-income VIP
players, he said.
Growth in the VIP segment is typically more volatile than the
mass market segment and can cause large swings in overall
revenue. To reduce reliance on high-rollers, the national and
Macau governments have been adamant that the tiny territory
would diversify into general leisure and tourism.
Overnight visitors have grown since August due to operators
attracting customers with cheaper hotel rooms and promotions but
individual spending is muted.
Looking ahead, analysts said a rebound in spending remains a
challenge despite new attractions including a mock Eiffel tower
and aerial gondola, due to slowing market growth and
infrastructure bottlenecks which hinder larger visitation into
Macau's teeming peninsula and glitzy Cotai strip.
(Reporting by Farah Master; Editing by Christian Schmollinger)