Delta Corp - A huge but risky opportunity


#83

I myself witnessed this year and biz was really good. I almost saw madness when people were pushing and shoving each other to place bets on many tables. Like stock market most of them were losing eventually. Good for shareholders though :slight_smile::grinning:

Disc: Invested


(Jatin Soni) #84

(roysavio) #85

A similar article as CalvinAyre’s with a little more detail. Bottomline: Onshore gaming can see a surge of revenues for Delta Corp and other casino companies.


(roysavio) #86

And now brokerages seem to be taking note:

Discl: I have invested from lower levels.


(suraj jethwani) #87

I Did some research on Delta Corp to understand why it is growing so fast, in Sept 2016, Delta Corp Ltd had acquired Gauss Network, which owns adda52.com, I tried to look up the traffic statistics for Adda52 Here is what I was able to find…

Disc: Started Invested small amounts at 382+ levels.


(aashish2137) #88

Is 397 category rank a good thing? In my opinion, internet gaming has a very short shelf life because you’ve so many of them out there that it takes a week for the users to move on. So a 397 rank could convert to 3970 overnight unless the Company has specific plans to retain its audience.


(suraj jethwani) #89

The Rank here is 397 in the World !!

I also noticed that Adda52 is a site which has continued to engage the Online card playing community since 2013/14 (pls. read Quora for details from these players).
Meanwhile there are several other sites which have faded away since that time.

Disc: I have started Invested small amounts from 382 levels


(yourraj) #90

very wel said current rank of adda.52 you can find at
https://www.alexa.com/siteinfo/adda52.com
Mostlly traffic from india and graduates males surffing from Home and office.

reward wil be huge if they can add more Capex on the Online Gameing field

Disc: Not Invested due to very high PE not having margin of safety as per my apetite
Regards
YourRaj


(Akash8968) #91

Can you please share the Q3fy18 Concall Transcript or details of the same if you have. thanks in Advance


(aswin) #92

(Marathondreams) #93

Can anybody assess how much will be bottom line impact on Delta Corp due to this hike? Stock is down 10% now so not sure if this is over reaction…

Disclosure - invested today as a tracking position


(bharat.jain) #94

For year ended December 2017 the license cost is 12 cr and it’s 5 percent of sales. Now it is increased around 4.5 times so it’s a huge expense for them


(Amit Mehta) #95

How much of the increase can they pass to the customers without impacting the business? Is the customer price inelastic?


(shreys) #96

I came across an interesting snippet of information. Delta Corp, India’s most recignized gaming company, which has provided splendid returns to investors is currently valued at 6730 crores ( 1.03 billion USD).
Another company, Boyd Gaming, listed on NYSE, a leading gaming company in the US is valued at around 23000 crores (3.6 billion USD).
Adjusting for purchasing power, both Delta Corp and Boyd Gaming are available at similar valuations.
But, Boyd Gaming has sales exceeding 12000 crores. Post adjustment for purchasing power, Boyd is 12-15 times larger than Delta. Now, people may adopt different conversion rates for PPP. Hence,the numbers may differ. But, the idea remains that despite being a company much,much larger than Delta valuations accorded are similar. So, it’s either the American markets undervaluing or Indian markets over valuing.
But, it’s pertinent to note that Boyd is a heavily indebted company.
So, is this disparity due to elevated debt or there’s inefficiency in markets.
Only time will tell.


(Marathondreams) #97

I think this means Delta has much bigger upside as Delta’s market penetration is much lower, maybe than Boyd Gaming (Disclosure - I have not studied Boyd)

But since this hike is applicable for all casino’s, I feel they will pass on to the end customer. Knowing casino customers are not well known to be cost conscious, I think this hike would have very minimal impact on Delta


(Saravanan B) #98

The company does not have a good asset turnover due to which it is inefficient in terms of using its assets. Cash flows are constrained.

Capex > cCFO - due to which the company will have to rely on external borrowings.

It is a classic case of valuations taking the front foot. Markets will mean revert. Delta Corp is no different. It will go down more.


(vivek423) #99

Pokerstars launching locally on Apr 17. I think this will be a huge threat to Adda52 and therefore Delta. Adda’s current advantage was that Indian credit cards could not be used to deposit money to PS. Now that PS is local, that advantage is gone - and as an erstwhile user of the Pokerstars platform, I think their playing experience is far superior.

Disc: Exited recently


(shreys) #100

I’m in agreement with you. I do feel that the gaming industry is here to stay and there’s scope for massive expansion. But, I find it hard to believe that it’ll be a monopoly. When the business starts getting attractive there’s no reason why no other entrepreneur will participate in this gaming boom. And, greater competition will obviously lead to some struggle. Monopolies seldom last. It’s current valuation, in my opinion, is that there’ll be little competition for eternity.
I like the business very much but it’s obscenely priced. Just my thoughts.
I may be totally wrong.


(Amit Mehta) #101

Sometimes increasing competition is a boon for the industry. The new player comes, spends a lot on marketing, educates and brings new customers and increases the size of the industry.

Without a doubt, it is a nascent industry with huge potential and currently, Delta Corp has a first mover advantage.


(vivek423) #102

Online poker has terrific social network effects. The more the number of players on a platform, the more the diversity of games on offer and the more enjoyable playing on that platform becomes. This is why Pokerstars has globally dominated online poker - especially after their acquisition of full tilt. In my view, this is a winner take all market and I would not bet against Pokerstars to be that winner.