Delta Corp (DELTACORP)

FairStock Score: 13/100 — RISKY

Score breakdown: P/E: 2/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 1/1

Key Financials

Strengths

• Near-zero leverage: debt/equity of 0.02 provides a strong financial cushion.
• Trades at 0.86 price-to-book, below stated book value of ₹94.23.
• Dividend yield of 2.04% offers some return while waiting for a recovery.
• Latest quarter remains profitable at ₹14 Cr, and trailing P/E of 16.77 shows residual earnings capacity.

Concerns

• Profit growth has collapsed by 77.61%, with sales down 14.23%.
• ROE of 5.01% and ROCE of 7.65% indicate weak capital productivity.
• Piotroski F-Score of 3/9 and FairStock Score of 13/100 point to high financial risk.
• Promoter holding of 34.47% is not commanding, and the stated free cash flow figure is inconsistent with the market cap.

AI Analysis

Delta Corp is the kind of name I would file under 'too hard' if I were managing your savings. The industry — recreation/gaming — is not one where I can see a durable moat; it is exposed to taxation, regulation and shifting customer whims. The financials confirm my uneasiness. Sales have shrunk 14.23 per cent and profits have plunged 77.61 per cent. In the latest quarter, Delta earned ₹14 crore on ₹160 crore of sales, a thin net margin. Return on equity is only 5.01 per cent, and return on capital employed is 7.65 per cent. If I hand you a business that earns 5 per cent on book, there is no Buffett-style compounding. The debt/equity of 0.02 is commendable — a fortress balance sheet with almost no leverage. The price-to-book of 0.86 offers a discount to stated book value of ₹94.23, but a low price-to-book is not automatically a bargain. I must ask whether the book value is earning anything and whether management can improve operations. The Piotroski score of 3/9 screams deteriorating fundamentals, and the FairStock Score of 13/100 is labelled risky. Even the free cash flow number, as stated, looks inconsistent with a ₹1,641 crore market cap. The 2.04 per cent dividend is a small sweetener, but not enough to compensate for falling earnings. I need evidence of a genuine catalyst — stable quarterly sales, improving margins, or a clear regulatory tailwind — before calling this a bargain. For now, I see a possible asset play, not a great business. In Graham's language, the margin of safety is visible on the balance sheet, but not yet in earning power.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer