Morgan Stanley analysts don’t expect there to be any easing of travel between Mainland China, Hong Kong, and Macau this year, though it’s a vastly different story for the ASEAN region.
Despite continuous public outcry, China has double-downed on its zero-covid policy – which was recently highlighted by the outbreak and subsequent lockdown of Shanghai and other regions.
Bernstein analysts in a note earlier this week said that there were as many as 55 million people under a form of lockdown across 22 cities in China.
In a Tuesday note, analysts from Morgan Stanley said it expects no easing of travel in the greater China region, but hopes travel reopening becomes more visitors after the PRC National Congress in October 2022.
Meanwhile, most Asian countries outside of China have been progressively easing travel restrictions from 2Q22, said MS, benefitting ASEAN gaming companies in both overseas and domestic demand recovery.
“All the ASEAN players were able to achieve positive free cash flow to equity (FCFE) in 4Q21 even before travel reopening with the help of domestic demand. FCFE should continue to improve through 2022, repairing their balance sheets,” said the analysts.
