Delta Corp Shares Drop in the Wake of Demonetization; Jhunjhunwala Picks Up More Shares

The Indian Prime Minister’s sudden announcement of demonetization of ₹500 & 1000 notes has not only created havoc in the country, but the echoes are reverberating across the gaming industry. The shares of Delta Corp, India’s largest and only listed gaming company fell by 36% to ₹104 on November 16. Taking advantage of the drop, Rakesh Jhunjhunwala (cover image), HNI investor immediately snapped up 12.5 Lakhs shares at an average price of ₹106.54.

Dealing mostly in cash, the gaming industry has been severely affected by the demonetization. Casinos in Goa that do have electronic payment channels, are unable to function as they are unable to return the changed cash demanded by customers.

The ripple effect has reached Las Vegas as well. The Nevada Commission on Tourism had set up a special trade office in New Delhi to woo the plush Indian tourist, numbered at approximately 450 million towards Sin City. However, in the current scenario it is unlikely that such numbers will be fulfilled, rendering the tourism goals of Nevada worthless.

One person who seems to be betting long-term though, is ace investor and billionaire Rakesh Jhunjhunwala, who immediately bought 12.5 Lakhs shares of Delta Corp after they fell to a low of ₹104.

Jhunjhunwala and his wife Rekha already own 1.15 crore and 1.1 crore shares of the company and clearly Jhunjhunwala is banking on the past performance of Delta Corp which had risen to a high of ₹195.20 on October 26, after the company posted a profit of ₹32 Crores.

The company showed a rise of 5.25 points on the BSE, post Jhunjhunwala’s purchase.

Delta Corp, owned by Jaydev Mody began as a realty firm and later diversified into hospitality and gaming. The company owns several onshore and offshore casinos in Goa, besides properties in Daman and other places.

Cover Image courtesy: Wealth18.com