Delta Corp Ltd Q4 FY23 Earnings Conference Call Insights

Key highlights from Delta Corp Ltd (DELTACORP) Q4 FY23 Earnings Concall

Q&A Highlights:

• [00:08:09] Viraj Mehta with Equirus asked about the timeline of the new ship to come on-stream. Hardik Dhebar CFO replied that there is likely to be a slight delay and in 4Q23 the vessel is expected to come in.

• [00:10:57] Viraj Mehta of Equirus enquired about the number of employees for the quarter. Hardik Dhebar CFO answered that for the quarter, close to 125,000 would have come in.

• [00:15:45] Karan Mehta from Nirzar Securities asked about the operational cost structure and employee strength for all businesses. Hardik Dhebar CFO answered that employee strength for the gaming business as a whole is about 3,000 people. Broadly 75% of the costs are fixed in nature, which includes big ticket items like the license fees and employee costs.

• [00:23:18] Guneet Singh at CCIPL queried about the new vessel coming up, what kind of expansion in monthly revenue is expected. Hardik Dhebar CFO said that in terms of capacity, DELTACORP will be going up about 2.5-3 times the existing capacity.

• [00:25:19] Guneet Singh with CCIPL asked about any update on the Daman casino. Hardik Dhebar CFO answered that June 8^th is the next date of hearing.

• [00:26:10] Pritesh Chheda at Lucky Investment asked about the utilization for the year of new ships. Hardik Dhebar CFO replied that the company hasn’t seen a weak opening as the demand is high for DELTACORP as there are 1 crore people a year in visitations in Goa. And DELTACORP has been fairly utilized from day one.

• [00:29:21] Chirag Lodaya at Valuequest enquired about the reason for delay in the new ship and the capex spent. Hardik Dhebar CFO clarified that these are operational yard or steel supply related issues. On capex, the total capex is of about INR250 crore and spent about INR140-160 crores and INR120-130 crores is yet to go.

• [00:31:33] Sakshi with Swan Investment asked about the EBITDA margins on the online gaming business. Hardik Dhebar CFO said that the company is just breaking even currently due to all the earnings from the poker business being invested in the multi gaming platform.

• [00:32:36] Sakshi with Swan Investment queried about the FY24 marketing and other expenses numbers. Hardik Dhebar CFO replied that about 50% will go on marketing and other 17-18% goes on sales and business promotion. So 50-60% of revenue generated goes back into marketing and sales promotion.

• [00:36:01] Nitin of MC Research asked if the ban of online gaming in Tamil Nadu spread to other states and how it will impact DELTACORP’s gaming business. Hardik Dhebar CFO said that unlike Rummy, poker is a pan-India game. Therefore, a state banning does not impact heavily for the company. But there could be a knee-jerk reaction.

• [00:43:48] Viraj Mehta of Equirus asked about the completion time of the non-core assets and cash on books at year end. Hardik Dhebar CFO said that in 18-24 months it should be complete. Cash on books at year end is about INR535 crores.

• [00:45:34] Mayur Gathani at OHM Portfolio asked about an update on the Nepal and Sikkim growth YonY. Hardik Dhebar CFO answered that Nepal is doing around INR4 crore a month since it only began operations post COVID. Sikkim is settled at around INR2-2.5 crore per month, which is double what it was pre-COVID.