Shares of Delta Corp declined over 3 percent to Rs 106 on January 14 after the company reported a weak third-quarter performance for fiscal year 2024-25 (Q3FY25).
Over the past one year, shares of Delta Corp slid over 27 percent, underperforming benchmark Nifty 50's 5 percent rise.
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The online gaming firm posted a modest 3.5 percent year-on-year (YoY) increase in net profit to Rs 35 crore in Q3FY25, while revenue dropped 7.5 percent YoY to Rs 194 crore. At the operating level, EBITDA fell sharply by 42.4 percent to Rs 32.2 crore, and EBITDA margins contracted significantly by 1,000 basis points YoY to 16.6 percent.
Delta Corp operates casinos and has a diversified business across segments such as real estate, gaming, hospitality, and others. Under its Deltin brand, the company runs three casinos in Goa, including Deltin Royale, Deltin JAQK, and Deltin Caravela.
Recently, Delta Corp and other companies in the sector were served demand notices running into thousands of crores between mid-2023 and the first half of 2024. However, the Supreme Court granted a stay on GST proceedings against a group of online gaming companies at the government’s request, citing limitation concerns.
The Supreme Court ruling is seen as a relief for online gaming companies, as it prevents GST authorities from demanding tax payments from them until final orders are issued. This follows a series of notices issued by the Directorate General of GST Intelligence (DGGI), leading to a tax demand of Rs 1.12 lakh crore from 71 online gaming companies.
Online gaming firms have contested the payment of 28 percent GST instead of the 18 percent rate for the period up to October 1, 2023. In August 2023, the GST Council amended the law to clarify that all online games involving bets, whether based on skill or chance, would attract a 28 percent GST rate on the full value of the bets placed, rather than the gross gaming revenue.
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