Asia

Research Brief: Gaming in India

Posted on July 16, 2016

Since the release of Global Market Advisor’s (“GMA”) white paper entitled “Gaming-In-India-White-Paper” in April 2016, India’s gaming market has evolved with a new gaming license issued in Goa and the potential legalization of gaming in India’s second largest populated state: Maharashtra. In this research brief, GMA quantifies the value of the potential gaming market in Maharashtra and includes an updated review of the gaming market in Goa.

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History and Current Status of Gaming in Taiwan: A White Paper

Posted on June 16, 2016

Taiwan has long been a venue of interest among foreign casino investors, originally because of the importance of Taiwan as a source of customers and more recently because of the potential to reach Chinese customers through the ever-increasing transportation and tourism links between Taiwan and China. The effort to bring casino gaming to Taiwan, however, has been a journey of stops and starts over the past 25-plus years, though there has been fairly steady progress since 2009.

In 2009, the Taiwanese island of Penghu held a public referendum on the establishment of casino-based tourist zones. The referendum was the culmination of nearly twenty years of advocacy on the part of politicians, gaming companies, university professors and professional advisors. The referendum failed. However, in 2012, Matsu held a referendum that passed. While the success of Matsu’s referendum was supposed to politically incentivize the Taiwanese government to pass gaming legislation regulating casino operations, and the government did retain a law firm to draft the Tourism Casino Administration Act (the “Act”), the Act has been stalled in Taiwan’s legislature since 2013.

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Gaming in India: An Evaluation of the Market’s Potential

Posted on April 16, 2016

Although Macau’s gaming market is struggling, its reliance on the Chinese gamer still allows it to dominate the global gaming landscape and maintain its role as the largest gaming market in the world. As a result, the global gaming industry remains transfixed by the potential value of the Chinese gaming market. Not surprisingly, gaming destinations throughout the Asia Pacific region, including Singapore, Cambodia, Philippines, Vietnam and South Korea, have opened hoping to capitalize on the market’s potential. Some gaming operators have attempted to target other possible valuable demand segments in Asia like the Japanese. With these large sources of demand capturing the attention of the gaming industry, many gaming operators and markets have yet to fully explore other alternative sources of Asian based gaming demand.

So far, few gaming operators have considered China’s democratic and capitalistic neighbor, India, as a potential source of demand. India shares many of the same characteristics that make China such an attractive source of gaming demand. India also has a large, prosperous economy, an enormous population, and favorable consumer/gaming habits. On top of that, India is able to offer a stable and less reactionary government and volatile economy.

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New Kid in Town: Can Vietnam emerge as an international gaming-resort destination?

Posted on January 13, 2015

Despite the recent downturn in gaming revenue in Macau, Asia remains the region of the world with the greatest opportunities for casino development. While Japan and Taiwan remain the most enticing markets, if only enabling legislation were to be passed, other markets are attracting the interest of casino developers. Unfortunately, most of those opportunities are in markets that are loosely regulated, difficult to get to, surrounded by poor infrastructure or require border crossings that can best be described as challenging.

One market that continues to interest investors is Vietnam. With 92 million citizens, a burgeoning middle class, good airport infrastructure and airlift to a number of nearby countries, Vietnam appears poised to emerge as a regional gaming market that is capable of producing a prodigious amount of gaming revenue. Nevertheless, a number of issues must be resolved before the country can live up to its potential.

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So, Have You Been to Poipet?

Posted on April 25, 2014

When examining the major casino markets of Asia, Macau and Singapore most often come to mind. Most gaming executives are familiar with these markets, and their prodigious gaming revenue performance continues to attract the interest of the media and financial analysts.

The extraordinary performance of these markets has caused casino developers to look more closely at other regional Asia markets such as South Korea, Vietnam and Japan as they look for that next great opportunity.

What are often overlooked are other regional Asian markets that are already established yet are somewhat removed from major Asian cities. These gaming markets generate prodigious amounts of gaming revenue and serve as convenience-based gaming destinations to regional populations.

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Seven Keys to Casino Success

Posted on February 16, 2013

The success of Singapore’s recently established casino industry, along with the unprecedented growth in gaming revenues in Macau, has attracted the interest of governments throughout Asia. Several are considering instituting new policies that will permit the expansion of casino gaming in their countries in the form of so-called integrated resorts, as a means to boost
economic and tourism growth and generate tax revenues.

The examples of Macau and Singapore, together with those of other Asian countries that did not manage to enjoy quite as much success with their casino initiatives, have helped identify seven factors that are critical to the success of any new gaming venue in the region.

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Russian Roulette: Is Vladivostok Russia the Next Important Gaming Destination in Asia?

Posted on September 16, 2012

Vladivostok, Russia, a city much closer to Beijing than Macau and bordering northern China; a city in which President Vladimir Putin has spent over $18 billion over the past four years improving and building; the incredibly strategic southernmost port city in Russia, has opened its doors to the world to develop the integrated entertainment destined to be a world-class casino-resort destination serving northeastern Asia, and in particular, northern China.

All you have to do to understand its potential is look on a map. However, there is no buzz in the industry, and operators are quickly missing the next new gaming destination in Asia.

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Asia: Seven Steps to Success

Posted on July 27, 2012

Call it the Macau/Singapore effect.

The initial success of integrated casino resorts in Singapore, coupled with the unprecedented growth in gaming revenues in Macau, has attracted the interest of government policy-makers in
countries throughout Asia. Several are now considering instituting new policies that will permit the expansion of casino gaming in their countries in the form of what is now being referred to as integrated casino resorts, and with it, both economic and tourism growth.

The success of Asian resorts has helped identify those factors that are critical to the success of any new gaming venue. Here are seven factors that are critical to creating a successful gaming policy that grows tourism, enhances tax revenues and acts as an engine for economic growth.

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Swapping Out Debt: Solving the riddle of debt-asset swaps and triangular deal structures

Posted on April 16, 2009

The riddle of “debt-asset swaps” is currently befuddling CFOs, public debt analysts, casino buyers and hedge funds.

All look to profit from discounted gaming company debt and the sale of distressed assets. Right now, there is a disconnect between a gaming company and its debt. On the one hand, the gaming company’s debt—whether $5 billion of publicly traded bonds or $50 million in privately held notes—is trading at prices that may be 10 cents to 70 cents on the dollar. On the other hand, the gaming company may be willing to retire that debt at face value, as part of its de-leveraging process.

The theory of a debt-asset swap is to take advantage of that disconnect. If one could purchase the gaming company debt at today’s steeply discounted price, and then present it to the gaming company for retirement at face value, then one should be able to profit greatly.

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What Can We Learn from Macau

Posted on April 17, 2007

As gaming markets mature and individual casinos’ databases become established, casino operators are able to better understand the demographic makeup of their core customers. With few exceptions many Indian casino operators have come to recognize that Asian Americans, in particular immigrants from China, make up a sizable minority of their customers and display an almost passionate love of casino gambling. To better serve this important segment, many casinos have introduced noodle bars, expanded Asian food offerings in their buffets, added Chinese speaking hosts and printed collateral material in various Asian languages. Some have also brought in Asian entertainers. While these programs make sense, they are essentially tactical plans that
are put in place on a hunch rather than understanding that player segment’s wants and needs. They fail to recognize that not all Asian American gamers are alike and each nationality has its own particular appeals.

For most domestic markets, Chinese Americans are the most dominant Asian gaming segment. Notwithstanding some markets may be comprised of other nationalities. Therefore, it is critical to first understand which Asian nationalities comprise the largest part of the casino’s demographic mix. If Chinese Americans are indeed the largest, then it is important to understand their unique wants and needs. And to really understand what motivates Chinese gamblers, you have got to go to Macau.

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