Local casinos regain momentum as Chinese group tourists return

A foreigner-only casino at Jeju Dream Tower integrated resort / Courtesy of Jeju Dream Tower

Korea’s foreigner-only casinos are gaining renewed momentum this year, triggered by a steady recovery in inbound tourism and expectations of a surge in Chinese group travel in the second half, according to a recent analysis by Shinhan Securities.

According to Shinhan’s analysis report, unlike other tourism segments that move with domestic consumption, casino performance is closely tied to inbound flows, making the pace of Chinese visitor growth the key variable for the remainder of the year.

“Inbound indicators such as arrivals, foreign spending and foreigner-only casino earnings are now numerically confirming what the market is feeling as an inbound boom,” Ji In-hae, an analyst at Shinhan, said.

Korea’s casino industry is open only to foreign visitors as domestic gambling is tightly controlled under Korean law — Kangwon Land is the only casino open to Koreans.

Korea launched a temporary visa-free program for Chinese group tourists last September to revive inbound tourism and regional economies.

The brokerage expects earnings to improve across the board, but says the extent of recovery will vary by location, customer mix and whether operators run integrated resorts with hotels and entertainment facilities.

Paradise Group, which runs Paradise City in Incheon and a foreigner-only casino in Busan, is cited as a major beneficiary of easing travel rules for Chinese group tourists, who can now enter visa-free on designated package tours.

Lotte Tour Development’s Jeju Dream Tower Integrated Resort is expected to extend its growth trajectory with recovering international flights, rising casino foot traffic and higher hotel occupancy.

Grand Korea Leisure, which runs foreigner-only casinos in Seoul and Busan, is also forecast to benefit from both Chinese VIPs and general foreign tourists as core gateway cities see inbound demand rebound.

“The full China-facing positioning of Korea’s foreigner-only casinos remains valid,” Ji said, noting that Busan could become the biggest beneficiary of visa-free group travel and that operators with Busan properties could gain the most if the trend continues.

Korea Tourism Organization data show cumulative arrivals of Chinese visitors between January and May reached about 2.56 million, up roughly 25 percent from a year earlier, underscoring a robust recovery trend.