Delta Corp Announces Divestment Worth Rs 80 Crore In Subsidiary To Kolkata-Based Ability Games

Delta Corp, the prominent gaming and hospitality company, has announced the divestment of its entire holding in Caravella Entertainment Private Limited to optimize its portfolio and enhance shareholder value. The company has entered into a share purchase agreement with Ability Games Limited and Ashtek Consultancy Private Limited, marking a significant shift in its business strategy.

Delta Corp's decision to sell its entire shareholding in Caravella Entertainment, a wholly owned subsidiary, is in line with its vision for portfolio optimization. The divestment, valued at Rs 80 crore, includes Rs 18 crore of parent debt and Rs 62 crore of equity value. Notably, Delta Corp's stake in Caravella Entertainment represents 89.29% of the share capital of Deltin Nepal Private Limited.

The sale comes as part of Delta Corp's broader plan to refocus its business activities and streamline its operations. The company aims to adapt to market dynamics and create additional value for its shareholders.

Ability Games Limited, based in Kolkata and known for its promotion of the listed online game development company Yudiz Solutions, is set to acquire Delta Corp's stake in Caravella Entertainment. The deal not only adds a new player to the gaming industry but also strengthens the position of Ability Games in the market.

Despite its unique market position, Delta Corp's shares have experienced corrections in recent times. Over the past six months, the shares have witnessed a 20% decline, with a 25% drop in the last year and a substantial 46% dip over the last two years, according to analytics.

The company's financial performance has also seen fluctuations, with consolidated net profit in the third quarter reported at Rs 34.48 crore, reflecting a significant YoY decline of 59%. In the same quarter of the previous year, Delta Corp had reported a net profit of Rs 84.82 crore.

The decision to divest its holding in Caravella Entertainment aligns with Delta Corp's broader strategy to adapt to market changes, enhance shareholder value, and create a more focused business model. The deal with Ability Games Limited and Ashtek Consultancy Private Limited is anticipated to pave the way for a more streamlined and efficient operation for both Delta Corp and its new stakeholders.

While Delta Corp's shares concluded Wednesday's trading session with cuts of nearly 1.5% at Rs 142.25 per share, the company's strategic moves are likely to generate interest in the gaming and hospitality industry. The stock has shed more than 25% in the last one year.