Mehabe score: 4 G Factor: 6 Piotski Score: 5 The stock has a rating HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 6 and Piotski score of 5.
Description
Delta Corp is currently operates in the Gaming, Hospitality and online skill gaming segment.(Source : 202003-01 Annual Report Page No:113)
Main Points
Delta Corp Ltd is the largest gaming company in India and they are the only listed company in the casino gaming with 2000+ live gaming positions. They have managed to capture 55% of market share in the organized casino market and it has three major areas of business.Site:DELTACORPMain Symbol:DELTACORP
Stock trades at 188.0, above its 50dma 175.85. It also trades above its 200dma 155.61. The stock remains bullish on techicals
The 52 week high is at 202.00 and the 52week low is at 85.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– has reduced debt.
– is almost debt free.
Weakness
– Stock is trading at 2.59 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 2.23% over past five years.
-Promoter holding is low: 33.28%
– has a low return on equity of 6.36% for last 3 years.
-Earnings include an other income of Rs.27.08 Cr.
Competition
– The industry trades at a mean P/E of 103.7x. Delta Corp trades at the industry’s max P/E of 103.73x. DELTACORP trades at a P/E of x
– Industry’s mean G-Factor is 3.5 while the mean Piotski score is 6.0. DELTACORP has a G-Factor of 6 and Piotski scoreof 5.
– Average 1 month return for industry is 12.5%. The max 1- month return was given by Touchwood Enter.: a return of 21.62 %
Quarterly Results
Sales for period ended Jun 2021 is Rs 76.0 cr compared to Rs 48.0 cr for period ended Jun 2020, a rise of 58.3%
Company reported negative operating profit of Rs -28.0 cr for period ended Jun 2021. For same period last year, operating profit was -33.0
The EPS for Jun 2021 was Rs -1.08 compared to Rs 2.17 for previous quarter ended Mar 2021 and Rs -1.05 for Jun 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 446.0 cr for period ended TTM vis-vis sales of Rs 419.0 cr for the period ended Mar 2021, a growth of 6.1%. The 3 year sales cagr stood at -17.6%.
Operating margins expanded to 4.0% for period ended TTM vis-vis 3.0% for period ended Mar 2021, expansion of 100.0 bps.
Net Profit reported at Rs -25.0 cr for period ended TTM vis-vis sales of Rs -24.0 cr for the period ended Mar 2021, falling 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has worsened on its Return on Equity (RoE) metric. The RoE on Last Year basis was -1.0% compared to 6.0% over the last 3 Years. – The stock has given a return of 102% on a 1 Year basis vis-vis a return of -8% over the last 3 Years. – The compounded sales growth on a TTM bassis is -46% vis-vis a compounded sales growth of -12% over the last 3 Years. – The compounded profit growth on a TTM basis is -110% vis-vis a compounded profit growth of % over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 8.14% vis-vis 8.77% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 51.2% vis-vis 50.49% for Dec 2020
Conclusion
– has reduced debt.
– is almost debt free. – Stock is trading at 2.59 times its book value
– has low interest coverage ratio.
-The company has delivered a poor sales growth of 2.23% over past five years.
-Promoter holding is low: 33.28%
– has a low return on equity of 6.36% for last 3 years.
-Earnings include an other income of Rs.27.08 Cr.
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 175.85 and is trading at 188.0, thus bullish price action wise.
