In assessing the long-term prospects of the Macau gaming industry, brokerage firm Citigroup highlights the significant impact of the widespread adoption of smart gaming tables on its growth.
In their latest in-depth report, analysts George Choi and Ryan Cheung shed light on the utilization of radio frequency identification (RFID) tables, emphasizing the myriad benefits that are poised to bolster gaming revenue.
According to Citigroup’s estimates, RFID tables, commonly referred to as smart gaming tables, now constitute 10 percent of all tables in Macau.
Based on observations from their latest monthly table survey, Citigroup notes that all Mass baccarat tables at two MGM China casinos are now equipped with smart gaming technology. Additionally, a total of 140 smart gaming tables were observed at the Mass concourse of the Londoner casino in Macao.
The research team also observed 24 smart gaming tables at the Grind Mass area in Wynn Macau, although none were seen at Wynn Palace. According to management comments during their most recent earnings calls, companies like Galaxy, Melco, and SJM have already placed orders with smart gaming table suppliers, with plans for gradual rollout throughout 2024.
Analysts indicate that the use of smart gaming tables and RFID chips has become one of the hottest topics in the gaming industry and among gaming institutional investors.
‘We believe the benefits from smart gaming tables and RFID chips are real,’ says Citigroup. They assert that the technology can organically help operators grow their gross gaming revenue (GGR) without the need to increase foot traffic into the casinos or reduce operating expenses.
While smart gaming tables themselves cannot drive more foot traffic into casinos, the technology can expedite gameplay. According to Citigroup’s estimates, saving five seconds per game of baccarat could translate to a 5.9 percent organic growth in GGR.
Furthermore, smart tables facilitate the capture of data on players’ betting patterns, allowing for more accurate valuation and cost-effective player-comping strategies.
‘It makes sense for casinos to increase their comps on players who consistently spend 10 percent of their baccarat wagers on the Lucky 6 exotic bet, as these players are, on our estimates, worth 125.5 percent more than players who strictly make main bets,’ notes Citigroup.
Another significant benefit is the prevention of counterfeit chip usage, a problem not uncommon in casino criminal cases.
Additionally, smart tables enable casinos to introduce new exotic and higher hold bets in a cost-efficient manner, as well as helping identify and locate high-value yet unrated players.
Citigroup also lists other benefits, including the accurate capture of foreign player volumes, which could potentially reduce the gaming tax rate by up to 5 percent, targeted training for dealers to cut training costs, and enhancements in anti-money laundering (AML) and responsible gaming measures.
