Delta Corp Share Price Plummets 27% In Two Days: GST Impact And Future Outlook

Delta Corp Ltd has faced a steep decline in its share price, witnessing a sharp fall of 27% over a span of two days. In the previous session, the stock plummeted by over 23% and continued its downward trend by slipping an additional 5.18% today, ultimately settling at Rs 179.55. The primary reason behind the rapid decline is the recent decision by GST Council to impose 28% GST on online gaming, horse racing, and casinos.

This decline has raised concerns among investors, as the technical charts indicate potential challenges ahead. The 14-day relative strength index (RSI) for Delta Corp's shares currently stands at 24.50. An RSI level below 30 signifies an oversold condition, suggesting that the stock may face further downward pressure. With a P/E ratio of 23.42 and a P/B value of 2.33, Delta Corp's stock carries certain risks. Additionally, its one-year beta of 1.10 indicates a high level of volatility, adding to the uncertainty surrounding its future performance.

Industry analysts predict that Delta Corp's financials could suffer long-term consequences due to the newly imposed 28% GST. As result, stock is expected to face continued selling pressure in near future. Market experts have identified a potential support level at Rs 170.

Ravi Singh, a market expert, stated, "The stock may witness continuous selling pressure in the coming weeks as the 28% uniform GST on online gaming, horse racing, and casinos will have a lasting impact on the company's financials. The stock price is likely to remain in a downtrend and touch the levels of Rs 160."

Considering the implications of the new GST regulation on online gaming, Vaibhav Kaushik, a research analyst at GCL Broking, emphasized that the increased tax burden could discourage users from participating. This, in turn, may impact the company's revenue. Kaushik recommended closely monitoring the next two quarters' results to assess the full extent of the impact. For now, he advised caution, stating, "The stock can range between Rs 150 to Rs 210. Avoid is the recommendation for now."

AR Ramachandran from Tips2trades highlighted a strong support level for the stock at Rs 173 and advised investors against making purchases at the current time.

Delta Corp is well-known for its involvement in the casino industry and operates under the DELTIN brand. The company's segments include real estate, gaming, hospitality, and others. It owns three casinos in Goa - Deltin Royale, Deltin JAQK, and Deltin Caravela.

While the Indian equity benchmarks reached all-time high levels with gains in banks, financials, metals, technology, and realty stocks, investors are closely monitoring Delta Corp's volatile performance. The recent developments impacting the stock's trajectory have prompted investors to carefully consider their options for the best course of action.