June GGR (-12% YoY); Negative Revisions Set to Continue

Research evidence excerpt

June GGR (-12% YoY); Negative Revisions Set to Continue

UpdateMValuation Methodology and Risks

Wynn Macau, Limited (1128.HK)

Base case scenario value, derived using a target yield on 2026e FCFE. Our target FCFE yield

is 9.0%, which is 100bps higher than the long-term average since 2012, reflecting structurally

weaker operating leverage and higher sector risk premium. The relatively lower target FCFE

yield lift reflects higher payout boosting cash returns. We also deduct the annual amount of

the capex portion of committed non-gaming from each year's FCFE calculation.

Risks to Upside

n Greater-than-expected GGR market share gains

n Non-gaming investment being accretive to earnings

Risks to Downside

n Worse-than-expected market share loss from peers adding new capacity

n More scrutiny of the premium mass segment

Sands China Ltd. (1928.HK)

is 8.0%, which is 100bps higher than the long-term average since 2012. Our relatively lower

target FCFE yield uplift reflects larger scale and stronger liquidity. We also deduct the annual

amount of the capex portion of committed non-gaming from each year's FCFE calculation.

n Better-than-expected market share momentum after renovation

n Faster-than-expected dividend recovery

n Faster-than-expected recovery of grind mass

n Improvement in Venetian

n Londoner Grand ramp up slower than expected

n Grind mass recovery remains slow

MGM China Holdings Limited (2282.HK)

Base-case scenario value, derived using a target yield on 2026e FCFE. Our target FCFE yield

is 10.0%, which is 200bp higher than the long-term average since 2012, reflecting structurally

weaker operating leverage and higher sector risk premium. The relatively higher target FCFE

yield uplift reflects smaller scale and weaker liquidity. We also deduct the annual amount of