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SJM is set to undergo a ‘renaissance’ say analysts

The gaming operator’s new management intends to revitalise the company with a greater focus on global investment and mass market appeal
  • The Grand Lisboa Palace is going to be repositioned to appeal to the mass market, with refreshed shopping and restaurant offerings

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Casino concessionaire SJM Holdings is slated to broaden its global investor base and work towards boosting its appeal to the mass market, according to multiple media reports that cite CBRE equity research analysts John DeCree and Max Marsh. The analysts made their assessment on Tuesday after meeting with SJM’s chief financial officer Christopher Ip. 

They said that Ip was looking to break with tradition by “proactively” engaging with global investors and noted that the operator “has a renaissance story in the making.” SJM’s new management, which came into place after a leadership reshuffle in December 2023, reportedly has plans to institutionalise the company and “reposition Grand Lisboa Palace to better cater to base mass customers, increase visitation to the property, and identify operating efficiencies.” 

Some of the measures that were mentioned to achieve this goal included introducing new restaurant offerings, optimising the tenant mix and implementing new marketing strategies. 

CBRE pointed out that SJM Holdings’ new direction would require time to be implemented, but was confident about the concessionaire’s prospects, revising its forecast for SJM stock from HK$2.50 to HK$4.00. 

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The CBRE analysts also expressed optimism regarding the local gaming sector, in spite of concerns over the state of the Chinese economy. 

They acknowledged that while Macao could be negatively impacted by mainland China’s economic slowdown, the “pent-up” post-Covid demand for leisure in China and other markets would help to drive growth in the city, which has “proven more resilient.” 

They added that “the continued gross gaming revenue (GGR) recovery in Macao through May suggests less correlation to the China economy.” May’s GGR reached 20.2 billion patacas (US$2.5 billion), an increase of almost 30 percent year-on-year. 

The analysts also pointed to the central government’s support of Macao through the inclusion of 10 additional mainland Chinese cities in the Individual Visitor Scheme – a move that is expected to boost local tourism. 

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