Billionaire Jhunjhunwala-backed Delta plans casinos in Sri Lanka

Tuesday, 5 October 2010 00:15 - - {{hitsCtrl.values.hits}}

Bloomberg: Billionaire Rakesh Jhunjhunwala- backed Delta Corp. plans to open casinos in Sri Lanka in the next six months to tap a surge in tourist arrivals to the island nation after the end of a 26-year civil war.

Casino operator-Delta, which also develops property and runs an aircraft charter service, will spend 10 billion rupees ($225 million) in the next three years in opening casinos in the region as well as at home in Sikkim, Daman, and Goa, Chief Financial Officer Hardik Dhebar said in an interview in Mumbai. Gambling is not allowed in most Indian states. Delta wants to benefit from a revival in Sri Lanka’s tourist arrivals, which surged 47 percent in the first eight months of the year, according to the nation’s tourism agency. Shares of companies including John Keells Holdings Plc and Aitken Spence & Co. have more than doubled as tourist incomes boosts earnings at their hotels and resorts.

“We have not even scratched the surface yet” for casino opportunities in the region, Dhebar said. “Sri Lanka is in a hurry to start speed up the process of development and is taking steps to ensure investment flows into the country.”

Faster economic growth in India and Sri Lanka is helping boost salaries in the region increasing demand for leisure spending, Dhebar said.

India’s economy grew 8.8 percent in the quarter ended June 30, the fastest pace in two-and-a-half years. Sri Lanka’s $42 billion economy may grow as much as 8 percent in 2010, the central bank said on Sept. 21. The nation’s troops defeated the separatist Liberation Tigers of Tamil Eelam in May last year, ending their 26-year quest for a separate homeland helping attract tourists and investors to the nation.

Billionaire Jhunjhunwala and investor Radhakrishna Damani bought an 11 percent stake in the company last month. Jhunjhunwala, with $1.15 billion in assets is India’s 57th richest man, according to Forbes magazine.