Shares of this small-cap stock dragged more than 20 percent today after announcements made by the GST council pertaining to the industry the company operates in.
With a market capitalization of Rs 5,200 crores, the shares of Delta Corp Limited started their trading session today at Rs 222.05 and currently trade at Rs 193.30, slipping around 22 percent compared to the previous closing levels of Rs 246.70. It is trading near its 52-week low levels recorded at Rs 172.30.
Such a sharp fall was observed after Finance Minister Ms. Nirmala Sitharaman, in a meeting of the Goods and Services Tax (GST) Council on Tuesday, levied a 28 percent uniform GST on online gaming, casinos (full value of the bets), and horse racing.
According to a survey by Esports Players Welfare Association (EPWA), the above move will generate an additional burden on the gaming companies and, moreover, affect future revenues.
Having a look at the financials of the company, the operating revenues, as well as net profits, have shown positive movements with the former moving from Rs 616 crores during FY21-22 to Rs 1,020 crores in FY22-23. The net profit figures have bounced back after losses faced in FY20-21 and were reported at Rs 261 crores during FY22-23.
According to the shareholding pattern data available for the March 2023 quarter, the Promoters hold a 33.28 percent stake, and Foreign Institutional Investors (FIIs) hold a 5.35 percent stake in the company.
Engaged in the Gaming and Casino industry, Delta Corp Limited operates various segments including Online Skill Gaming, Hospitality, etc. The company derives a majority of its revenue from the ‘Gaming’ segment and, geographically, from the Indian markets.
Apart from Delta Corp, the shares of Nazara Technologies, a Rekha Jhunjhunwala stock, saw a dip of around 4 percent and currently trades at Rs 680.
Written by Amit Madnani
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