Hoiana IR positive for SunCity’s potential Macau license bid

SunCity’s foray into an integrated resort business in Vietnam will prove useful should the company attempt to obtain a license in Macau come 2020-2022, said Union Gaming in a Monday note.

“In regards to the license rebid process in Macau, Suncity’s Hoiana will put them in a better position to win a license (in the event a 7th license is issued) not only because Suncity will be a bonafide IR operator with local roots, but that licensing Suncity would also repatriate VIP dollars to Macau where it provides a benefit to the local community (i.e. tax receipts),” said the brokerage.

Union Gaming said it recently visited the IR site in Hoi An, Vietnam, and met with management. “Construction on the Phase 1 portion of the project is meaningfully underway and remains on track for a mid-2019 opening,” it reported.

SunCity in November was given shareholder approval to acquire a 34 percent stake in the US$4 billion integrated resort in Vietnam.

The Hoi An project will consist of seven phases to be developed over a span of 13 years, which includes tourism areas, an integrated resort complex and residential areas.

Phase 1 will consist of a world-class casino with a total of 140 gaming tables and 1,000 slot machines, an ultra-luxury Rosewood Hotels & Resorts, a 445-room hotel and 200 buy-to-let condos; and a championship golf course-country club by Robert Trent Jones II.

It will also include recreational facilities including a beach club and entertainment venue for live shows and events, watersports and dive centre, and a promenade packed with bars and restaurants and is expected to commence operations by the second quarter of 2019.

SunCity’s dominance in the Asian VIP market is also a force to reckon with, said Union Gaming.

SunCity owns nearly 50 percent of market share in Macau VIP, a market that is expected to grow further this year.

“Based on conversations we’ve had with the company they still expect mid-teens+ VIP growth in Macau this year. Early 2018 results, indeed, appear to suggest that VIP remains robust and that upwards of 20 percent growth is achievable,” said Union Gaming.