Delta Corp shares tumble over 23%; other online gaming-related stocks also hit

New Delhi: Shares of Delta Corp fell sharply by over 23 per cent on Wednesday, and other online gaming-related companies also declined after the GST Council agreed to impose a 28 per cent tax on online gaming, casinos and horse racing.

The stock of Delta Corp tumbled 23.28 per cent to settle at Rs 189.35 on the BSE. During the day, it had dropped 27.79 per cent to Rs 178.20.

Delta Corp is engaged in the casino (live, electronic and online) gaming industry. Incorporated in 1990 as a textiles and real estate consultancy company, it has evolved into diversified segments such as casino gaming, online gaming, hospitality, and real estate.

Shares of Nazara Technologies dipped 2.58 per cent and OnMobile Global went lower by 1.12 per cent.

The GST Council on Tuesday decided to levy the maximum 28 per cent tax on the full face value of bets in online gaming, casinos and horse racing.

Online gaming companies on Tuesday said levying of 28 per cent GST will limit their ability to invest in new games, impact cash flows as well as business expansion.

Online gaming players have repeatedly urged the government and the GST Council to levy 18 per cent GST on their segment, instead of 28 per cent that was recommended by Group of Ministers (GoM).

The All India Gaming Federation (AIGF), which represents companies like Nazara, GamesKraft, Zupee and Winzo, said the decision by the council is unconstitutional, irrational, and egregious.

"The decision ignores over 60 years of settled legal jurisprudence and lumps online skill gaming with gambling activities. This decision will wipe out the entire Indian gaming industry and lead to lakhs of job losses and the only people benefitting from this will be anti-national illegal offshore platforms," AIGF CEO Roland Landers said.