Ways to Profit from the Asian Gaming Boom

The National Bureau of Economic Research declared the recession over in June 2009, but don’t tell that to the American entertainment industry.
2010 has been a very difficult year for just about every sector of the entertainment business as cash-strapped consumers are looking for inexpensive ways to entertain themselves.
• According to the Digital Entertainment Group, video movie sales have shrunk by $1 billion so far this year.
• Despite the help of my sons, video games sales have dropped by 9% to $6.6 billion through the first half of 2010.
• Music CD sales have plunged by 18% in the first half of this year according to Nielsen SoundScan. Album sales are down to 154 million from 172.9 million.
• Attendance at Disney’s domestic theme parks dropped by 3.0% over the last 12 months.

The entertainment picture is very different in Asia and is, in fact, becoming the new frontier for entertainment complexes. It may not be long until your children or grandchildren start bugging you to take them to Asia.
“The industry is moving to Asia. With key fundamentals in place such as the growing middle-class incomes in Asia, as well as demand for entertainment and leisure time, this is the perfect product for tourism and economic development,” said Christian Aaen, Asian regional director of research firm AECOM Economics, which specializes in entertainment and leisure industry analysis.
• In just the first six months of operation, the new Universal Studios theme park in Singapore has already welcomed more than one million visitors.
• In Japan, you can choose from Tokyo Disneyland, Disney Sea, or Universal Studios in Osaka … .all three of which are among the world’s top 10 theme parks in terms of attendance in 2009.
• Danish LEGOLAND© is building its first Asian branch in Malaysia’s Johore Bahru, right across the Singapore border.
• Disney is pleased enough with the performance of its two existing parks — Tokyo and Hong Kong — that it will break ground in November on another theme park in Shanghai.
• Encouraged by its success in Singapore, Universal Studios is going to build the largest theme park in the world in Korea at a cost of US$2.6 billion. When completed in 2014, the Korean resort will be bigger than Universal Studios’ other parks in Florida, Osaka and Singapore combined.

How can you profit from this Asian casino boom? There are a bunch of choices and all of them are available on an American stock exchange.
Wynn Macau (1128.HK or WYNMF.PK)
SJM Holdings (0880.HK or SJMHF.PK)
Melco International (MPEL)
Genting Singapore (G13.SI or GIGNY.PK)
Sands China (1928.HK or SCHYY.PK)

Additionally, MGM China Holdings has filed with the Hong Kong Stock Exchange to list its Macau casino. MGM currently has one casino in Macau but plans on opening more with the proceeds from this IPO.

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