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The Indian real-money gaming (RMG) scene just witnessed a seismic shift, a strategic play that’s sent ripples across the industry. Delta Corp, the publicly listed giant with a strong presence in casinos and online gaming, is merging its online skill gaming arm, Deltatech Gaming (the force behind Adda52 and Adda52Games), with Head Digital Works (HDW), the parent company behind the leading rummy platform A23, which also has a presence in poker with A23 Poker. This isn’t a simple acquisition; it’s a carefully structured two-stage merger that ultimately leaves Delta Corp with a 5.70% stake in the combined entity, signifying a calculated recalibration rather than a complete exit.
Deconstructing the Deal: A Two-Part Tango
The transaction unfolds in two distinct phases. Initially, HDW will acquire a 51% controlling stake in Deltatech Gaming for approximately ₹491 Crores. This initial phase will see Delta Corp walking away with a combination of cash and equity in HDW, setting the stage for the second act. The grand finale involves the complete absorption of Deltatech Gaming into Head Digital Works. Following this merger, Delta Corp will hold a 5.70% minority stake in the newly formed powerhouse. This complex dance is expected to conclude before June 2026.
“We’re excited for this journey with Deepak (Gullapalli, founder of Head Digital Works) and the team, whose leadership has been instrumental in shaping the online Rummy market in India. We believe that this transaction will help Adda52’s leading position in the online poker market,” said Ashish Kapadia, Managing Director, Delta Corp.
What HDW Stands to Gain
For HDW, this merger represents a significant strategic victory. It gains control of Adda52, a pioneering and highly recognized poker brand in India. This acquisition provides HDW with immediate scale and a formidable presence in the increasingly competitive poker landscape, positioning it to challenge established players like Nazara Technologies, which recently acquired a 47.70% stake in PokerBaazi, India’s largest online poker platform.
Delta Corp’s Strategic Retreat: A Calculated Fold?
Delta Corp’s strategy is one of risk mitigation and portfolio rebalancing. By merging Adda52 with HDW, Delta Corp reduces its direct exposure to the inherent volatility of the online poker market, particularly in the face of the challenging 28% GST regime.
Maintaining a minority stake allows Delta Corp to remain invested in the potential of the skill gaming sector without the full operational burdens and risks. Deltatech Gaming reported a total income of ₹92.90 Crores for FY24, contributing to about 9.46% of Delta Corp’s FY24 revenues. Delta Corp initially planned to take Deltatech Gaming public and filed for a ₹550 Crore IPO in June 2022. But those plans were shelved in August 2023, the GST whirlwind cited as the reason.
Adda52: From Startup to Industry Leader
Adda52’s story is one of entrepreneurial spirit. Founded in 2011 by two IIT Delhi graduates, Anuj Gupta and Mohit Agarwal, it was a trailblazer in bringing real-money skill gaming to India. In 2012, they were among the first to offer online real-money poker. Delta Corp’s 2016 acquisition of Adda52 for ₹182 Crores marked their full entry into the online poker world.
Key Milestones:
The GST Shadow: A Catalyst for Change
The new tax regime with 28% GST on the face value of bets has undeniably squeezed the profit margins of RMG operators. This, coupled with the looming threat of substantial retrospective tax demands, has created a challenging regulatory environment. Deltatech Gaming faces demands totalling a staggering ₹6,384 Crores, which were subsequently stayed by the Supreme Court. While neither Delta Corp nor HDW has explicitly pointed to GST as the primary driver behind the merger, industry observers note that such regulatory headwinds often accelerate mergers, acquisitions, and partnerships.
Delta Corp’s Real Estate Gambit: Doubling Down on Bricks and Mortar
Delta Corp isn’t just playing the digital game. They’re making big moves in real estate and hospitality, developing integrated resorts, expanding their hotel portfolio, and planning to spin off their gaming and hospitality businesses into separate entities. The launch of a new, state-of-the-art floating casino in Goa demonstrates their continued commitment to the physical casino experience. Key indicators of this pivot include:
While Delta Corp is stepping back from online gaming, it is also actively advancing its physical casino business by introducing a brand-new floating casino ship to replace the iconic Deltin Royale vessel. Built at its Waterways Shipyard, this next-generation casino aims to redefine luxury gaming in Goa and beyond. Once launched, the current Deltin Royale could transition to replace older vessels, effectively boosting capacity across all its floating casinos and enhancing on-ground player experiences. Such moves underline Delta Corp’s strategic confidence in brick-and-mortar casinos and the overall tourism push in India, particularly in Goa.
A Different Kind of Deal: Not Just a Copy and Paste
The Nazara-PokerBaazi deal presents a different dynamic. In that deal, PokerBaazi’s parent company retained majority control. Delta Corp, in contrast, is ceding direct control over Adda52. Also, while Nazara’s move is part of a broader diversification strategy, the HDW-Adda52 merger is about consolidating power in the card gaming arena.
The Live Poker Enigma: A Potential Synergy
A key question mark hangs over the future of live poker and the potential synergy between HDW and Delta Corp’s Deltin Poker Tournament (DPT), India`s only running live tournament series. Integrating DPT with A23’s user base could create a powerful cross-promotional opportunity, bridging the gap between online and live poker. However, no official announcements have been made, leaving this possibility shrouded in speculation.
The Broader Landscape: Consolidation and Competition
This merger reflects a wider trend of consolidation within the Indian skill gaming market, especially with similar acquisitions like metaverse and gaming tech company OneVerse acquiring Spartan Poker, PokerDangal, Calling Station and PokerSaint recently.
Larger platforms are increasingly seeking scale and diversification to navigate regulatory headwinds and capitalize on growth opportunities. For players, this consolidation could translate into more lucrative promotions, tournaments, and a richer overall gaming experience.
Looking Ahead: Uncertainties and Opportunities
Delta Corp’s future likely involves a continued emphasis on its real estate and hospitality portfolio. HDW and Adda52 together have the potential to achieve significant scale and market leadership. The entire industry, however, remains subject to the uncertainties of the evolving regulatory landscape, particularly concerning the final resolution of the GST issue.
The merger of Adda52 and HDW marks a pivotal moment in the Indian RMG sector. Delta Corp is strategically repositioning itself, while HDW is poised to become a dominant force in the combined rummy and poker market. The potential integration of live poker through DPT adds another layer of intrigue to this evolving narrative.
This is a developing story. Keep following PokerGuru for all the latest updates!
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