Following 26 consecutive monthly declines, Macau’s casino revenue rebound since August has been attributed to debuts of new resorts, most recently Parisian Macao from Sheldon Adelson, and, surprisingly, much of the gaming revenue growth has come on the VIP side. Gains in high roller revenue reverse three years of declines amid China’s slowing economic growth and President Xi Jinping’s crackdown on corruption. Rising VIP revenue also runs contrary to the local government and Beijing narrative that Macau’s future lies in turning away from high roller gambling and toward tourism and leisure. Digging deeper into the numbers shows that, beyond the headline rise in VIP revenue, Macau keeps moving toward a sustainable recovery model.

As reported in Inside Asian Gaming, the rise in VIP revenue is not a mirage. Not long after insiders, including some junket executives, were declaring Macau’s junket system dead, Morningstar Asia equity analyst Chelsey Tam explains here’s a been a return in confidence in the system, Since the theft of an estimated HK$330 million (US$42.5 million) by Dore Group associates at Wynn Macau last September, Macau has enacted new regulations to increase junkets’ financial transparency and stability. Big three junket promoters Suncity, Neptune/Guangdong Group and Tak Chun have used the regulatory and business changes to raise their market share from 50% to 80%, according to Union Gaming managing director in Macau Grant Govertsen.

The icing on the cake for junkets was finding Huang Shan, the junket financier who fled Macau with more US$1 billion in April 2014. Encountered in Cambodia by Hang Sheng Group and now the junket promoter’s guest in Vietnam, Huang says he’s ready to repay junket investors. Arrests of Crown Resorts employees in mainland China on gambling promotion charges adds to Macau junkets’ leverage in the VIP trade.

But Macau’s real growth story goes beyond the VIP headlines. A November 15 in depth report from JP Morgan declared the recovery is underway and it’s time to invest for the long term. Analysts DS Kim and Sean Zhuang cite three reasons to believe in Macau’s “genuine, sustainable recovery.” Gaming revenue beat expectations for four consecutive months through October, typical of an inflection point. Gaming revenue has improved across all segments and properties, including the Macau peninsula, indicating a genuine rise in demand, “not a short-term blip from new openings or luck,” the report says. Third quarter earnings for five of six Macau casino licensees beat estimates, all but Wynn Macau as Wynn Palace in Cotai ramps up slower than expected.

Most important is what JP Morgan calls “quality improvement in visitors,” drawn by factors underpinning gaming revenue growth. Since late last year, visitor growth has come in the overnight (versus day-tripper) and individual (versus group tour) visitors categories, driven, the bank says, by the wave of new Cotai resorts, starting with Galaxy Macau’s Phase 2 and Broadway in May last year, increasing Macau’s appeal relative to Hong Kong and overall. The report also says that mix of mass market players has moved away from the extremes of the segment to the middle market.

Whether or not Macau has done enough to get repeat business over the long run, particularly from mainland travelers not primarily motivated by gaming, remains to be seen. Boutique investment bank CLSA, for one, believes Macau has more work to do on that front. For the medium term, JP Morgan sees mass market gaming revenue increasing faster than mainland China’s GDP growth as rising affluence – increasing disposable income and more time to travel – converge with greater access to Macau in the form of more (and cheaper) hotel rooms and improved travel infrastructure. The latter story will play out over the next five years with the bridge connection to Hong Kong and completion of rail links with the mainland looking particularly powerful. The larger point is that Macau does have a viable long term growth scenario worth considering, something that seemed far less plausible just a few months ago.