JP Morgan Forecast Integrated Resorts $5B Boost to Thailand Economy

Thailand is set to become a significant player in the global gaming and tourism industry, with integrated resorts (IRs) projected to generate annual revenues between US$1.5 billion and US$5 billion, potentially contributing up to 1% to the country s GDP. JP Morgan s analysis suggests that large-scale projects in Bangkok, with an estimated budget of US$3-6 billion, could start operations by 2031, yielding EBITDA between US$0.4 billion and US$1.5 billion and an internal rate of return of 12-29%. The government s approach to awarding licenses will be pivotal, with one to three licenses initially granted for Bangkok projects, followed by smaller regional complexes. IRs in Bangkok are expected to draw a substantial number of foreign tourists, with gross gaming revenue (GGR) projected to account for over 90% of total revenues, despite occupying only about 5% of the total gross floor area. Thailand s diverse tourist attractions and cultural offerings are expected to give it a competitive edge over major gaming hubs like Macau and Singapore. The Thai government is working on the Entertainment Complex (EC) Bill, which is expected to be deliberated in parliament later this year. This legislation aims to formalize the gambling sector and redirect the substantial underground economy into the formal sector. Potential operators, including global giants like Galaxy Entertainment Group, Genting Singapore, and MGM China, are anticipated to form joint ventures with local entities to leverage regional expertise in land and property management. However, the entry into the casino business carries potential risks, particularly related to investment based on environmental, social, and governance (ESG) criteria. Around half of sustainable AUM globally are subject to gambling exclusions, posing a challenge for Thai companies aiming to attract ESG-focused investments. With the legislation expected to be in place between 2024 and 2026 and official bidding projected for at least 2028, the path towards realizing these integrated resorts requires careful planning and execution. The successful integration

Source: news.worldcasinodirectory.com
Published on 2024-10-03

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