Delta Corp Reports 67.6% Decline in Q1FY25 Net Profit to Rs.21.68 Crore

Delta Corp Ltd., an entertainment and gaming company, reported a 67.6% decline in its consolidated net profit for Q1FY25. The net profit for the April-June quarter stood at Rs.21.68 crore, a sharp decrease from Rs.67.9 crore recorded in Q1FY24 which highlights the challenging environment the company faced during this period. 

Revenue Decline

Delta Corp’’s revenue from operations also witnessed a notable fall, declining by 30.3% y-o-y to Rs.180.7 crore in Q1FY25 from Rs.259.3 crore in Q1FY24. Revenue from gaming operations, which is the highest contributor to Delta Corp’s top line, saw a 33% drop to Rs.169.42 crore. The company’s hospitality segment also faced challenges, contributing to the overall decline in revenue.

Sequential Comparison

On a sequential basis, Delta Corp’s net profit declined around 69% from Rs.72 crore reported in the previous quarter (Q4FY24) which indicates a continuous downward trend in profitability, reflecting the market conditions and challenges.

EBITDA and Margins

Delta Corp’s EBITDA fell 68.2% year-on-year to Rs.30.5 crore in Q1FY25, compared to Rs.95.8 crore in Q1FY24. The EBITDA margin contracted significantly, standing at 16.9% as opposed to 36.9% recorded in the previous year showing pressure on the company’s operating profitability.

Stock Performance & Appointments

On the stock market front, Delta Corp’s shares are trading around 4% lower at Rs.136 today. Over the past year, the company’s share price has plummeted by over 43%, and 10% in 2024. In addition to its financial report, Delta Corp announced the appointment of Tara Subramaniam and Pankaj Razdan as Additional Directors designated as Non-Executive Independent Directors for a tenure of five years. 

Conclusion: In conclusion, Delta Corp’s decline in net profit and revenue in Q1FY25 highlights the challenges faced by the company amidst regulatory and market pressures. Despite the downturn in financial performance, the company announced a final dividend of Rs.1.25 per share, subject to shareholder approval at the upcoming meeting. The gaming industry, particularly online gaming and casinos, has been under scrutiny due to regulatory changes and high taxation. The sector was hopeful for amendments to the CGST Act, 2017, which would quash retrospective tax demands and review the 28% rate levied on online gaming but there. Have been no updates regarding this.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.