A smoking ban in Asia's Las Vegas took effect over the weekend, sparking concerns that the policy could stub out the gaming outlook for Macau.
Macau's latest measure, introduced on Monday, will see all main gaming floors in its 35 casinos go smoke-free. Casino operators are allowed to build smoking lounges but installation of gaming tables or slot machines are prohibited within these areas. To date, only 12 of the special administrative region's casinos are ready with smoking lounges on their mass floors, according to a government statement over the weekend.
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The rules are stricter-than-expected; analysts had expected members-only and premium mass areas to be exempt from the smoking curb, but authorities widened the scope of their ban on September 30. Some worry the ban could hurt gaming operators' revenue, which is already declining as Beijing's two-year-old anti-graft campaign keeps high-rollers from the Mainland away.
"Previously we had expected just a low-to-mid-single-digit percentage impact to overall gross gaming revenue (GGR) from the smoking ban, but we now expect a higher mid-to-high-single-digit impact [since] smoking is not allowed in premium mass areas as well," Barclays Research wrote in a note.