Delta Corp Slips 3% As Q3 Net Profit Falls 59% To Rs 34 Crore; Details
Delta Corp Slips 3% As Q3 Net Profit Falls 59% To Rs 34 Crore; Details
The Delta Corp stock has lost 38.27 per cent of its value over the last six months.

Shares of Delta Corp dropped 5 per cent to Rs 143.10 in early trade on January 10, post registering a 59 per cent decline in Q3 net profit to Rs 34 crores.

Revenue from operations during the said quarter, too, declined by 15 per cent to Rs 232 crore compared with Rs 273 crore in the same quarter of last year.

This is the sixth straight session where the counter has recorded a fall. The price correction was amid significant volumes with more than 43.76 lakh shares changing hands on the NSE around 9:30 am.

The company reported an EBITDA of Rs 55.5 crore in the third quarter, down about 45 per cent from a year ago. It was Rs 102 crore in the third quarter of the previous year.

Meanwhile, EBITDA margins dropped sharply to 23.9 per cent in the October-December period from 37.4 per cent in the corresponding period of the previous fiscal.

Anil Malani, of Delta Corp, shared on CNBC-TV18 that, “the company faced a downturn in the Oct-Nov quarter due to the impact of a higher GST regime. Revenue slumped as customers were required to pay a 28 percent GST upfront on chips.”

Despite the challenges, Malani expressed hope for a revival in Q4. He also disclosed that one of Delta Corp’s ships is scheduled for dry docking in January.

The company is currently dealing with total claims amounting to approximately Rs 23,000-24,000 Cr in terms of GST show cause notices, with all cases set to be heard next month. Malani anticipates Q4 revenues to be similar to Q3 and mentioned the possibility of pivoting to the realty business, citing a lack of opportunities for casino growth in India.

Meanwhile, shares of Delta Crop on January 9 closed 0.20 per cent lower at Rs 150.70 apiece on BSE. It is to be noted that, the stock fell more than 1 per cent in the last hour of trading yesterday to close in the red, also that the stock has fallen over 5 per cent in the last five days in the run up to results.

Its two biggest business divisions – casino and online gaming – and saw sharp drop in revenue. Third and the smallest hospitality division saw improvement in revenue during the quarter.

The company said that during the quarter, Delta Corp and and its two subsidiary companies received show cause notices from the Directorate General of GST Intelligence, Hyderabad, for alleged short payment of Goods and Service Tax (GST) aggregating Rs 16,822.98 crore while another subsidiary was asked to cough up Rs 6,384.32 crore from Director General of GST Intelligence, Kolkata.

The company said it and subsidiary companies have filed writ petitions and have obtained stay order from respective High Courts. “Based on legal assessment [Delta Corp] is of the view that all the above notices and the tax demands are arbitrary in nature and contrary to the provisions of law.

The Companies will pursue all the legal remedies available to them to challenge such tax demands and the related proceedings,” the company said. Delta Corp also believes it has a good ground to defend against the said show cause notices and thus has not made provision for it.

The Delta Corp stock has lost 38.27 per cent of its value over the last six months. The benchmark Nifty 50 index has given a return of 11.31 per cent over the same duration.

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