Result Analysis: Delta Corp Ltd. (CMP:Rs.194.80) Result Update: Q4FY23

Delta Corp Limited is a hospitality and gaming company based in India. The company primarily operates casinos in the states of Goa and Sikkim, and also offers online gaming services through its subsidiary, Adda52. Delta Corp’s casinos offer a range of games including poker, blackjack, roulette, baccarat, and slot machines. The company also owns several luxury hotels and resorts in Goa and Daman. It also started its operation internationally with Deltin Casino International, located at Kathmandu Marriott Hotel in Nepal.

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    Stock Details
    Market Cap. (Cr.) 5055.49
    Equity (Cr.) 26.75
    Face Value 1
    52 Wk. high/low 333 / 162
    BSE Code 532848
    Book Value (Rs) 78.54
    Sector Entertainment


    Key Ratios
    Debt-equity: 0.02
    ROCE (%): 5.59
    ROE (%): 3.42
    TTM EPS: 9.85
    P/BV: 2.48
    TTM P/E: 19.78

    Result Highlights:


    • Delta Corp posted soft results in the March’23 quarter with Revenue increase of 4% YoY to Rs.227 cr. and Net profits increase of 6% YoY to Rs.51 cr.

    • EBITDA of the company decreased by over 13% YoY to Rs.60 cr. due to the rise in the cost of materials and rise of employee cost. EBITDA margin decreased with 60 bps to 26% compared to the same quarter of previous year.

    • Despite the fall in the EBITDA, Net Profit rose on YoY basis on the back of decrease in tax expenses in the quarter.

    • Among segments, Hospitality division grew by ~30% YoY and Online Skill Gaming division grew by ~11% YoY while Casino Gaming division grew by 1.8% YoY.

    • For FY2022-23, company clocked consolidated revenue of Rs.1,067 cr. and Net Profit of Rs.261 cr., EBITDA reached to highest level of Rs.350 cr. and EBITDA margin of 34% for the year.

    • The online gaming business segment posted a growth of ~18% to Rs.191 cr. for the FY22-23. However, several states are imposing restrictions on online gambling which may affect the business operations of the company.


    Management Commentary:

    •  Commenting on the March quarter results, Jaydev Modi, Chairman said, “The Year has shown a steady and robust performance vis a vis the previous years and we expect better performance in the years ahead. The information regarding launch of our new vessel is already in public domain and this will further propel the growth trajectory and help us achieve the desired goals.”
    • Hardik Dhebar, Group CFO said, The current FY witnessed a historic performance, the gaming revenue crossed the INR 1000 crores milestone and registered extremely strong EBIDTA and PAT numbers. We expect a similar performance for the year to come. Our focus on increasing our revenues and controlling costs will always be at the forefront. We will continue our focus on growth and improving margins.”


    Delta Corp has reported subdued performance in Q4FY23 with yearly growth of 4% in the revenue and 6% growth in the Net Profits. The highest revenue generating segment i.e. Casino Gaming business grew by only 1.8% on YoY basis mainly due to the non-operation of its flagship casino Deltin Royale for nearly one month. The Online Gaming business grew by 11.5% YoY in the 4th quarter, however ongoing mulling of banning online gaming related to betting is a major risk for this segment. However, the management of the company has positive outlook with the online gaming. For the whole FY23 company has reported the earnings of Rs.9.77 and is available at PEx of 19.9 at the current market price.


    Particulars (In Rs. Cr.) Q4FY23 Q3FY23 Q4FY22 QoQ% YoY% FY23 FY22 YoY%
    Revenue from Operations 227 273 218 -17% 4% 1021 616 66%
    Other Income 19 12 18 61% 2% 46 38 22%
    Total Income 246 285 237 -14% 4% 1067 654 63%
    Employee Benefit Expenses 43 39 37 8% 14% 159 123 29%
    Cost of Materials Consumed 29 30 22 -4% 28% 113 66 71%
    Changes in Inventories -14 -12 -8 12% 65% -48 -29 64%
    License Fees & Registration Charges 31 31 26 0% 21% 122 101 21%
    Other Expense 78 83 72 -5% 9% 325 226 44%
    EBITDA 60 102 69 -41% -13% 350 130 170%
    EBITDA Margin 26% 37% 32% -110 bps -60 bps 34% 21% 130 bps
    Depreciation & Amortisation Expense 15 15 16 -2% -6% 59 56 5%
    Finance Costs 2 3 2 -16% 40% 10 6 63%
    Exceptional Item -7 -8
    Profit Before Tax (PBT) 62 96 63 -36% -2% 328 98 235%
    Tax Expense 11 11 15 -7% -30% 67 30 125%
    Profit After Tax (PAT) 51 85 48 -39% 6% 261 68 283%
    PATM (%) 23% 31% 22% -80 bps 10 bps 26% 11% 150 bps
    EPS (in Rs.) 1.9 3.2 1.8 -40% 6% 9.8 2.5 289%
    Segment Revenue (In Rs. Cr.) Q4FY23 Revenue % Q3FY23 QoQ% Q4FY22 YoY%
    Casino Gaming Division 214 77.2% 272 -21.1% 211 1.8%
    Online Skill Gaming Division 47 17.1% 51 -6.6% 43 11.5%
    Hospitality Division 16 5.8% 15 9.8% 12 29.8%
    Total 278 100.0% 337 -17.6% 266 4.7%

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