In a Wednesday note following the publication of Delta Corp’s Q2 2020 financial results, DeCree forecast revenue in the company’s online segment to reach US$30.5 million in sales in FY 2022, which would imply a valuation of US$305 million to US$458 million based on valuations of between 10x and 15x of sales for US online gaming businesses.
Additionally, while revenue across the company dropped 68.5% to US$8.1m, more than US$7.5m of that came from online gaming. This is a 60% year-on-year improvement for the segment, and comes via Delta Corp sites like Adda52.com, Adda52rummy.com and LeagueAdda.com.
“[Online operations have] long been an undervalued and underappreciated component of the company’s business growth profile that can no longer be ignored,” said DeCree. “[These projections] suggest that online gaming is worth more than the current market cap of the entire company today. Similar to trends seen in the US and around the globe, Indian consumers have flocked to digital and online entertainment channels during the lockdown.”
Delta Corp management added in a statement that the company’s current financial health doesn’t have “any material adverse impact on overall net worth, [meaning it] will continue honour its liabilities and obligations, as and when due”.
While many physical casinos remain closed due to COVID-19, online gambling has provided stability for gaming companies globally, with the pandemic forcing accelerated consumer acceptance and acquisition.
In addition, India’s online gambling market is one of the fastest-growing iGaming markets in the world. As of 2019, it was worth US$830m, which is expected to quadruple within the next 10 years.
