Investors from Asia and other regions are showing a growing interest in investing in Macau casino debt, taking on the risks that come with it in hopes of higher returns compared to corporate debt. With the gradual recovery of gross gaming revenue in Macau, the debt issued by the region’s gambling and entertainment companies has become particularly attractive to investors.

Despite the challenges posed by the pandemic and China’s Zero-COVID policy, signs of recovery in Macau are encouraging bond investors to consider doubling down on their investments. The rebounding gross gaming revenues have caught the attention of various investors and consultancies, indicating a positive outlook for the region’s future.

In contrast, the share prices of Macau’s six concessionaires have yet to return to their pre-pandemic levels, with fluctuations and declines being observed. Although some experts argue that the stocks deserve better considering the strong recovery, investing in shares at this time appears to carry higher risks. Consequently, investing in bonds seems to be a safer option for investors amid the uncertainties surrounding stock investments.

The increasing trust in Macau casino bonds has resulted in Sands China’s bonds being upgraded to investment grade by S&P, while Melco’s credit rating has been upgraded to stable, further solidifying the attractiveness of investing in bonds. Additionally, investors are drawn to the benefits offered by the Macau casino operator bond, such as Asia’s low default rates and the reduced overall supply due to the departure of many Chinese firms from the bond market.

In related news, five concessionaires that had previously sought compensation from Suncity Group and its owner Alvin Chau have now dropped their claims. This decision follows Chau’s imprisonment in October, during which he received an 18-year sentence from the Court of Second Instance in Macau. Chau and his junket were implicated in various illicit activities, including fraud, criminal association, money laundering, and illegal gaming.

As bond investors continue to show confidence in Macau’s casino debt, the region’s recovery and the potential for lucrative returns are driving increased interest in this investment opportunity.

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