Here is Review of Delta Corp Ltd by UBS Securities.
Delta has invested US$10m in lieu of 25% stake in Jalesh Cruises and rights to operate casinos in its cruises. First voyage of Jalesh is scheduled for 17th April'19 and as per company's calendar it's offering ~60 cruises in FY20. Over next 18-20 months, Jalesh is likely to add 2-3 cruise ships and Delta will operate casinos in all the cruise ships, as per management. Current ship has passenger capacity of ~1,600 and offers ~150 gaming positions, we expect Delta to do revenue of Rs150-200m in FY20 which would be enough for break-even.
Using the three-year average of its historical multiples, we value Delta at 28x PE and 18x EV/EBITDA on its FY21E (prior avg. of FY20E and FY21E) to arrive at our price target of Rs340.00.
