BackDelta Corp share price hits fresh 52-week low, down 48% in about three months; what should you do?
Delta Corp share price drops to hit fresh 52-week low. Delta Corp share price hit its 52-week high of ₹259.95 on June 28 this year and in just three months, it has come down significantly. Currently, the stock is down about 48 per cent from its 52-week high.
PremiumDelta Corp share price dropped almost six per cent in the morning trade on BSE on Tuesday to hit its fresh 52-week low of ₹134.55. The stock opened at ₹137.50 against the previous close of ₹143 and plunged 5.90 per cent to its one-year low level.
In the previous session, the stock cracked over 18 per cent after it received a government notification requiring it to pay a tax of ₹16,822 crore for the period spanning July 2017 and March 2022.
The stock saw two bulk deals on Monday (September 25) on the BSE. Bonanza Commodity Brokers Private Limited sold 15.95 lakh shares of Dela Corp at a price of ₹140.34 per share. Later, the same firm bought 2.53 lakh shares of Dela Corp at a price of ₹140.21 per share.
On the NSE, however, it saw as many as 13 bulk deals. Take a look at the below table:
As Mint reported earlier, a notice for ₹5,682 crore was filed against three of the company's subsidiaries, Casino Deltin Denzong, Highstreet Cruises, and Delta Pleasure Cruises, the company stated in an exchange filing. The company received notification to pay an alleged tax liability of ₹11,140 crore, along with interest and penalty, for the period from July 2017 to March 2022, according to another exchange filing. If the company fails to do so, a show-cause notice will be issued to the company.
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The tax notice is a fresh blow to Delta Corp which has been struggling since July this year after the GST Council decided to impose a 28 per cent GST on the full value of online gaming.
In July, as Mint reported, Finance Minister Nirmala Sitharaman-chaired GST council members decided to do away with the distinction of game of skill and chance in the case of online gaming. Also, it levied a 28 per cent GST rate on the full value of online gaming, casinos, and horse racing. Tax will be applicable on the face value of the chips purchased in the case of casinos, on the full value of the bets placed with bookmaker/totalisator in the case of Horse Racing, and on the full value of the bets placed in case of the Online Gaming.
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This development spooked investors. Delta Crop share price has been in the red since July this year on a monthly basis. It suffered a loss of 21 per cent in July, followed by a 10 per cent fall in August. In September so far, the stock is down nearly 22 per cent.
Delta Corp share price hit its 52-week high of ₹259.95 on June 28 this year and in just three months, it has come down significantly. Currently, the stock is down about 48 per cent from its 52-week high.
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What should investors do?
Analysts are not positive about the stock. Some technical analysts recommend exiting the stock as they point out negative indicators on technical charts.
Gaurav Bissa, VP of InCred Equities observed Delta Corp has been one of the weakest midcap names in recent times.
"The stock has fallen after giving a breakdown from an ascending channel pattern on the weekly timeframe. It has witnessed increased volumes suggesting any rise is expected to result in further pressure," Bissa said.
"While the RSI on daily charts has entered deep oversold levels which can result in a temporary bounce, it is giving a fresh breakdown on monthly charts. The stock is trading well below its 55EMA (exponential moving average) and 89EMA on the monthly charts which supports the postulate of incremental pressure at higher levels. Investors who have already bought the stock can use ₹130 as their stop loss and use any rise towards ₹160-170 levels to exit their positions," said Bissa.
Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers pointed out that on a monthly scale, Delta Corp is looking weak.
"At the current juncture, this counter is near support of ₹140. If ₹140 level is taken out, then we may see ₹120 in the short term. On the other hand, resistance is seen near ₹160, followed by ₹180. On the indicator front, the monthly MACD has made a negative cross near the zero line, which hints towards some negative bias in the counter for the next couple of weeks," said Patel.
KKunal V Parar, VP of Technical Research and Algo, Choice Equity Broking said the downward movement of the stock is poised to persist in the near future.
"The stock has already experienced a breakdown of its 'Head and Shoulders' pattern neckline, accompanied by above-average trading volume. This breakdown strongly suggests a profound bearish trend. Weekly momentum indicators indicate a reduced likelihood for the stock to maintain its current position and execute a bounce-back move. The Relative Strength Index (RSI) has dipped below the critical threshold of 30, a situation that has not occurred for an extended period," Parar observed.
"The stock may continue to endure downward pressure, with potential downside targets ranging from ₹120 to ₹100. On the flip side, resistance to upward movement is expected at the ₹175 level," Parar added.
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Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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