Delta Corp - A huge but risky opportunity


(nikhil465) #123

My worry is the quantum of loans given as a percentage of net profits,

  1. FY16: Net Profit Rs.38.22 cr, Loan given Rs.12.61 cr (33% of profits)
  2. FY17: Net Profit Rs.73.75 cr, Loan given Rs.13.97 cr (19% of profits)

Also if the JV continues to be in losses, how will it ever repay the loan to Delta Corp.

Waiting for FY18 numbers to see if Delta Corp has again given loans to FCSPL this year.


(Mahesh) #124

Now that we have flights to Sikkim Airport, will we see an uptick in footfalls to the Sikkim casino? CMP factoring this in already?


#125

Sikkim is a small ops to make any big difference. Yes, it is incrementally positove.


(phreak) #126

Looks to be breaking down from a H&S pattern.

Disc: Exited in the last couple of weeks.


(ashish agarwal) #127

The businesses is realted considering invitation given to HNI customers for increase in business


(Marathondreams) #128

It seems Mr. Parrikar’s return would bring clarity to the new tax regulation related to Casinos in Goa

Stock price woke up from slumber and went up today by 7%!

Disclosure - invested for last 3 months and forms 1% of my portfolio


(maninder.nitw) #129

ET:Allow gambling, betting on sports as regulated, taxable activities: Law panel http://www.ecoti.in/3ZfJ7b


(maninder.nitw) #130

Great results posted by delta … 41 cr even after a huge license fee.


(maninder.nitw) #131

LP can be out anytime and this will massively help Delta.


(ashish agarwal) #132

What do u mean by lp?


(g1) #133

Casino Land Policy I believe. It is pending from a while now.

G1


(ashish agarwal) #134

Do you have any idea when it will be get cleared?


(roysavio) #135

Nothing new in the article but there might be a renewed push for land-based casinos:

https://news.worldcasinodirectory.com/delta-corp-limited-success-highlights-land-based-possibilities-57213


(ashish agarwal) #136

(vv15) #137

An update on my previous post.

Adda52 has completely blown away pokerstars India. Due to entry of pokerstars they were forced to work on user experience of Mobile App and Web platform. They have been really successful in enriching user experience by bringing lot many updates. Also they have been really innovative with the promotional campaigns. Adda52 i feel will continue to rule the online poker scene in India.

I exited @250. I will be a willing buyer if prices come close to 200 again. Though i feel we might not see those levels again.


(Deepen) #138

Any views on the current valuations ?
I am finding this super expensive and I wouldn’t call it a stable business given the risk of government intervention.


#139

over the last many years it has traded on an average of 35-40x trailing EPS and has 500cr+ cash, some other assets like stake in Advani hotels, land in Sri Lanka etc. I think it is slightly undervalued. Finally, some movement on the land based casino policy. Policy doc could should still take one month but downside is limited if the market remains stable.

Disc: Bought back which I had exited last quarter.


(ashish agarwal) #140

Residents of goa now are not allowed in casinos. Will it hurt their business?


#141

Not really, the law is valid even today but hardly effective. BTW, land based casinos remain out of bound for locals in many jurisdictions like japan or Singapore. It will not matter in long run once bigger international airport opens.


(Harshit Goel) #142

Delta Corp Ltd FY18 Annual Report Notes

  • During 2017-18, Delta delivered a remarkable financial performance, total revenue at Rs. 636.27 crore and Profit After Tax (PAT) at Rs. 155.55 crore. Earnings Per Share (EPS) in 2017-18 was 5.92, compared to3.19 in the year before.
  • Segment Sales: Gaming = 489.30 cr., Online = Rs. 64.535, Hospitality = Rs. 53.81, Total= Rs. 607.65.
  • Segment Results: Gaming= Rs. 210.26 cr, Online= Rs. 25.39 cr. Hospitality= Rs. (2,3.17) cr, Total = Rs. 212.48 cr.
  • Entering the gaming business in 2008, the Company has captured a lion’s share of the Indian gaming market through its five casinos in Goa and Sikkim. It owns three of the six offshore and one onshore gaming licence in the state of Goa.
  • The Company currently offers approximately ~1,800+ gaming positions in Goa and Sikkim.
  • The Company is also carving a niche in Daman through its integrated casino resort, which is awaiting regulatory approval, with approximately 1,000+ gaming positions. 5 star hotel spread in 10 acres. The resort has 27,000 sq. ft. of MICE (meeting, incentives, convention, exhibitions) space. It has 8,000 sq. ft. of high-end retail space.
  • Goa Offshore: Deltin Jaqk (13000 sq ft are), Deltin Caravela, Deltin Royale (40000 sq ft area)
    Goa Onshore: Deltin Suites (casino 1000 sq ft)
    Sikkim: Deltin Denzong
    Daman: The Deltin (casino is 60000 sq ft)
  • We currently own and operate two properties in Goa – Deltin Suites (106 rooms) and Deltin Palms (27 rooms). We also own and operate a hotel in Daman, The Deltin (176 rooms). Moreover, we have a 33.77% stake in Advani Hotels and Resorts (India) Ltd., the holding company of Ramada Caravela Beach Resort in Goa, with no operational interest or management control.
  • Adda52.com has a significant poker market share of over 60% across India. We are proud to be the only Company that offers all the three games – Poker, Rummy and Fantasy League. Estimates suggest India’s mobile games market will be worth $1.1 billion by 2020 and the number of users is projected to rise to 628 million.
  • Deltin Royale was the proud hosting member and hosting partner of the World Poker Tour, which was organised for the first time in India.
  • During the year, we also signed a Memorandum of Understanding (MoU) with Everest Hospitality and Hotel Pvt. Ltd., a subsidiary of Nepalese conglomerate, MS Group, to operate a casino in the 5-star 235-room Marriott Kathmandu.
  • The Goa government is soon expected to announce a formal casino policy. It is likely to make it mandatory for all offshore casino operators to shift to land within three years. The state will propose to designate as an Entertainment Zone where the casinos are expected to move. Area around the new airport could be one of such option. We have acquired 100 acres of land and are looking to acquire additional approximately 50 acres of land for an entertainment destination or a recreation zone. The strategy is to build the entire ecosystem for gaming and entertainment on an asset-light model to ensure an environment favourable for increased footfall.
  • According to Frost & Sullivan, the Indian gaming market, estimated at $338.4 million in revenue in 2017, is expected to grow threefold in four years.
  • While gambling is prohibited in most parts of India, certain amendments were made to the Goa, Daman and Diu Public Gambling Act, 1976, to legalise gambling to boost tourism in these regions. Sikkim is the only other Indian state to have legalised gambling.
  • As per a joint report by Google India and KPMG, India’s online games industry will grow by $1 billion from the present $360 million by 2021, registering a 20% growth. Further, the Indian gaming world is expected to cover over 310 million people from the current 120 million by 2021.
  • Promoter share decreased from 40.69% to 33.18%. No.of shares decreased from 9,42,57,471 to 8,87,97,440. Company raised Rs. 550 cr through QIP by issuing 3.59 cr shares.
  • Company raised Rs. 176 cr. through issue of Preference shares. Of theses Rs. 82 cr are Redeemable Preference Shares and Rs. 94 cr are Optionally Convertible Preference Shares.
  • Invested in Gaussian Networks Private Limited of Rs. 290 cr. (Online gaming).
  • Cash and Mutual Funds of Rs. 470 cr.

Regards
Harshit