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Expecting only single digit YoY GGR growth for April due to sluggish VIP volumes and low hold

Daily table revenues averaged only HK$927 million, up 7% WoW but flat YoY.  MTD, the average is only up 1%.  April is certainly coming in slower than even we thought, although we believe low hold is partly responsible.  Mass headcounts appeared to be reasonably strong over the weekend but VIP volumes may have been a little weak.  For the full month of April including slots, we are now projecting YoY GGR growth of only +4-8%.  That’s probably slow enough to provide more downside on the Macau stocks.  The good news is that we expect 20%+ YoY GGR growth in May but we have to get through April and only a reasonably in-line earnings season first.

Could China Macro finally be impacting Macau?  The operators and junkets we've talked to say no.  They generally view the weakness as a temporary break from the gangbusters pace Macau has experienced since January.  Nevertheless, the Macro hasn't been great.  Most recently, last week IMF called for China to rein in credit growth, especially outside of the banking sector, increased scrutiny of junkets and players, as well as travel warnings for Chinese tourists to Malaysia.

In terms of market share, MPEL and LVS are the market share winners MTD relative to trend at the expense of Galaxy.  We continue to view LVS as a market share gainer for the rest of 2014.  Keep an eye on Wynn for evidence that the property has made moves to bolster its VIP share.  We believe management there may be contemplating a more aggressive commission advancement strategy.