Early Monday trading saw a rise in shares of Macau casino stocks following China's announcement that eight more towns would be included to the Individual Visit Scheme (IVS) program.

Eight more places are now eligible for IVS, which makes it simple for people in the People's Republic of China to travel from the mainland to Macau and Hong Kong, according to a statement released by the State Council on Saturday. Using IVS eliminates the requirement to join a group tour or apply for business permits in order to enter the two Special Administrative Regions (SARs).

Macau's top official, Ho Iat Seng, praised the move and predicted increased tourism in the area, which is the only area under Chinese rule where gambling is legal. 

"The Macau SAR Government will endeavor to promote the hosting of more international events, enriching the content of MICE (Meetings, Incentives, Conventions, and Exhibitions), as well as cultural and sports activities, to create a diversified travel experience for visitors,” Ho declared.

Citizens of Taiyuan, Hohhot, Harbin, Lhasa, Lanzhou, Xining, Yinchuan, and Urumqi will be able to take part in the IVS program run by China's Exit and Entry Administration in the beginning of May 27.

Following the IVS revelation, shares of the US-traded casino stocks that are based in Macau surged. Melco Resorts was up more than 4%, Wynn Resorts was up 1.5%, MGM Resorts was up 1.3%, and Las Vegas Sands was up 1% as of 11 a.m. EST.   

China keeps up its support for Macau

The addition of these locations to the IVS program, according to gaming specialists, shows China's continued support for Macau. It also indicates that leaders in Beijing are not vehemently against casino gaming. 77% of Macau's tax income was generated by casinos in the previous year.

"The more near-term impact from the pronouncements should be a boost to sentiment as the policy measures are a clear indication from the Chinese government about its continued support for Macau and no negative association with the gaming industry,” said Seaport Research Partners gaming analyst Vitaly Umansky.

Founded in 2003 with the goal of boosting travel to Macau and Hong Kong, IVS currently encompasses 59 Chinese-controlled locations.

The expansion of the list of qualifying cities coincides with Hong Kong's efforts to rebuild its economy in the wake of COVID-19, which caused widespread commercial and expat exodus and national lockdowns. Macau's economy is also shifting as a result of driving away the majority of VIP junket companies who catered to high rollers on the mainland.

At their casino resorts, the six casino corporations are investing close to $18 billion in non-gaming developments. In late 2022, they agreed to refrain from gaming in exchange for a 10-year renewal of their gaming licenses.

IVS Expounded

Through IVS, residents of the 59 eligible cities can electronically apply for a Macau or Hong Kong visa. 

A person with a valid travel permission may visit the designated SAR for a maximum of seven days during a year. As of right now, there is no cap on how many IVS endorsements a traveler can get in a year.

The Macau SAR Government stated in January that 33 million visitors—or around 84% of the city's 2019 passenger count—were anticipated to visit the gaming enclave this year. That prediction could increase now that eight more communities are eligible for IVS.