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Tax Slap On Delta Corp Wipes Out ₹700 Crore From Its Market Cap

Monday morning brought bad news for Delta Corp, as the company’s shares hit a low and were reportedly quoted at ₹149.10. The share slipped by 15% from its previous close. At the time of writing this article, the stock was priced at ₹144.85. 

This drop in Delta Corp’s share price comes after the company was slapped with a tax notice worth ₹16,822 Crore. This tax amount is reportedly 3.5x the worth of Delta Corp’s last closing market capitalisation. 

News reports state that the gaming and hospitality brand will be pursuing legal remedies against the tax notice which was deemed as arbitrary and contrary to law by Delta Corp. 

On 22nd September, Directorate General of GST Intelligence issued a tax notice to Delta Corp demanding a sum of ₹16,822 Crore to be paid for the period of July 2017 and March 2022.

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As per the latest news reports, the company said the following in its exchange filing, “The amount claimed in the DG Notice is inter alia based on the gross bet value of all games played at the casinos during 2017-2022. Demand for GST on gross bet value, rather than gross gaming revenue, has been an industry issue and various representations have already been made to the Government at an industry level in relation to this issue.”

Previously, media reports covered how Delta Corp’s chief financial officer, Hardik Dhebar had resigned. News reports also stated how the company had informed that its initial public offering for its online gaming vertical was put on hold. 

This ₹16,822 Crore tax notice was a very hard blow to the brand and it remains to be seen how the legal remedies unfold in the coming days for Delta Corp.

As for the quarter ended June 2023, the firm had reportedly posted an 18.86% percent year-on-year (YOY) increase in its net profit which stood at ₹67.91 Crore. 

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