Gaming revenue in Macau, the world's biggest gambling hub, is expected to grow at a faster pace than expected this year on rising performance in the first quarter.
A research note by CLSA raises the overall forecast for the gaming industry's revenue growth this year to 14 per cent, from 9 per cent.
"Macau has been trading strongly with gaming revenue growth accelerating from 7.3 per cent in January to 11.5 per cent in February and 25.4 per cent in March," the research note said.
"April so far has been tracking at 14 per cent growth despite worries about outbreak of bird flu in [mainland] China."
Aaron Fischer, the head of consumer and gaming research at CLSA, said this month's revenue growth should be strong at 10 to 15 per cent.
"It is very clear to us that Macau is the best way to invest in the China consumer story," Fischer said.
Templeton Emerging Markets Group's executive chairman Mark Mobius said Macau would gain from expanding family entertainment as the city sought to become the mainland's top leisure spot.
"We see continued growth in view of the gradual transformation from an emphasis on only gaming to an emphasis on general entertainment for the family," Mobius said in an e-mail to Bloomberg.
"Macau and its surrounding areas will become [mainland] China's premier destination for leisure and entertainment."
Compared with the Las Vegas Strip, where the better share of revenue is derived from non-gaming businesses including entertainment shows and deluxe dining, more than 70 per cent of Macau government's revenue comes from gambling.
The city has been trying to diversify its gaming-dependent economy to woo tourists looking for something more than betting.
The casino operators that are building new resorts in Macau, including Galaxy Entertainment, MGM China and Wynn Macau, have all allotted big areas for luxury shopping centres, shows and restaurants.
Last year, the casino industry recorded gross gaming revenue of 304.1 billion patacas, up 13.5 per cent from 2011.
Shares of four of the six Hong Kong-listed Macau casino companies rose yesterday despite the benchmark Hang Seng Index closing 1.08 per cent lower.
MGM China led the gainers with a jump of 3.9 per cent to HK$17.78.
Melco Crown Entertainment rose 2.2 per cent to HK$59.50, while Sands China climbed 0.25 per cent to HK$39.85 and Galaxy Entertainment edged up 0.16 per cent to HK$31.90. SJM dropped 2.1 per cent to HK$18.66 and Wynn Macau fell 1.4 per cent to HK$21.35.