The creation of a travel bubble between Malaysia and Singapore is seen as a significant catalyst for the island’s two IRs, although severe capacity restrictions will create headwinds, according to Bernstein analysts.
The two countries have been in discussions and are expected to allow quarantine-free border crossings from August 17th, with mandatory Covid-19 testing.
“The opening of Singapore for Malaysian visitors is an important catalyst for Las Vegas Sands and Genting Singapore,” the analysts said in a note. They point out that Malaysians are the second-largest source of mass market GGR after Singapore locals.
However, Singapore has set capacity restrictions of 25 percent on its casinos, which will drag on growth.
Bernstein notes that Marina Bay Sands was already turning EBITDA positive with just the help from local patrons. “The recent opening of hotels will help with higher-end play and Malaysian business once the border opens,” it said.
Singapore gave the green light to reopening casinos on July 1st after a three-month closure. Initially, entrance was limited to existing casino members and annual levy holders only.