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Analyst: Local Macau Casinos to Benefit from Growth

15 August 2006

MACAU – As reported by MarketWatch: "Local casinos like Galaxy Entertainment Group Ltd. (0027.HK) will be the biggest beneficiaries of growth in Macau's high-roller market despite competition from U.S. operators, a CIMB analyst said Tuesday.

"While U.S. companies like Las Vegas Sands Corp. (LVS) and Wynn Resorts Ltd. (WYNN) are likely to do well in the mass market, Macau-based operators are best placed to tap high rollers, Steven Tan, the Malaysian firm's regional gaming analyst, said at a briefing for CIMB traders and clients in Singapore.

"Macau's local casinos can tap junket operators who offer credit facilities to high rollers in the region, doing away with the need to carry or transfer cash across boundaries.

"…Tan, who ranks Galaxy as one of his top picks in the Asian gaming sector, estimates Macau's revenues from mass-market gaming are likely to grow about 25% a year over the next few years, while the high-roller business will grow by a slower 7% a year.

"However, the high-roller segment is more lucrative, with gamblers wagering an average of US$2,500 a hand, compared with US$100 a day for the average casino visitor in Macau, he said…"

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