JP Morgan Analysis Reveals Thailand IRs Could Generate up to US$5 Billion Annually

Thailand is carving a place among key players in the global gaming and tourism sector with a vision for integrated resorts (IRs). These resorts are forecasted to have a weighty influence on its economy, which has stagnated post-pandemic. The investment bank JP Morgan recently conducted an analysis and concluded that the resorts could generate up to US$5 billion annually in gross gaming revenue. The GGR could account for 1% of the country's gross domestic product (GDP).

All Eyes on Bangkok

JP Morgan's analysis focuses on the potential economic contributions of large-scale IR developments in Bangkok, which are estimated to cost US$3-6 billion. SKYH Entertainment Group has proposed a casino resort development in the Nong Chok district. The sprawling 1,000-acre development will feature an ultra-modern casino, a Formula 1 circuit, several 5-star hotels, and more attractions.

This and similar projects are scheduled to kick off commercial operations by 2031. The projected economic benefits include an estimated EBITDA of US$0.4-1.5 billion and an internal return rate of 12% to 29%.

JP Morgan indicated in its report, "The government's flexibility in awarding licenses will be crucial, allowing either a single license with a substantial minimum investment or multiple smaller licenses to spur widespread development."

Strategic Approach

Bangkok's integrated resorts are expected to tap into the local and international markets. While casinos will likely occupy about 5% of the gross IR floors, they are projected to generate 90% of the gross gaming revenue. Foreign tourists are estimated to contribute 50% of total revenues. SKYH Entertainment's casino resort intends to attract the international market with a strategic proposed location a few kilometers from Suvarnabhumi Airport.

"Unsurprisingly, gross gaming revenue from casinos will likely drive 90%+ of total revenues and we estimate 50%+ of revenues to be from foreign tourists," stated JP Morgan's analysts.

Legislation Is Making Progress

The Thai government is in the process of legalizing the Entertainment Complex Bill, which will be deliberated later this year. The bill is receiving a strong push from the government and underwent a positive public hearing in September.

The legislation is expected to become law by 2026, after which official bidding for integrated resorts will start by at least 2028. The bill's success could enhance Thailand's tourism and allow it to compete with major gaming hubs in Singapore and Macau.