Nazara Technologies IPO Review – Online Gaming Company Backed By Jhunjhunwala

  • Post last modified:March 17, 2021
  • Post category:Stock Market
  • Reading time:16 mins read
  • Post author:

Nazara Technologies IPO is getting launched for subscription on Today 17, March 2021, and will be available for subscription till Friday, March 19, 2021. The company is looking to raise Rs.583 crore through public issue in an Offer for Sale of 52.94 lakh Equity Shares, Ahead of the IPO, the Nazara has already raised Rs. 261.37 crore from 43 anchor investors at Rs.1101 per equity share.

Rakesh Jhunjhunwala held 11.51% (32,94,310 shares) stake Nazara Technologies as of March 2020, according the company’s draft prospectus (DRHP). However, Jhunjhunwala is not selling any share through this issue.

The equity shares of Nazara Technologies IPO are proposed to be listed on both BSE and NSE.

The Nazara Technologies IPO issue will be sold in the price band of Rs. 1100-1101 per share and the minimum lot quantity is 13 shares and in multiples thereof translating to a minimum investment of Rs 14,300.

The latest Grey market premium price (GMP) for Nazara Technologies IPO’s were seen up by more than 78.35% and were trading around Rs.860 as of today, This means people are expecting it to open on listing day to be at least at Rs.1800 or more.

 

nazara ipo gmp

 

Having said that, I would like to add here that many people underestimated Stovekraft IPO before it’s launch, however the share price made a high of Rs.545 above the pre-open IPO price band of Rs.384.

Likewise for HFFC (Home first finance) IPO, the GMP before launch was at about Rs.650 however the stock got listed at Rs.540 (This was Recommended by Famous Business news Anchor? ) on the other hand for IRFC IPO many people recommended a BUY and GMP were also seen at quite high range but unfortunately it open at a discount price and is currently trading at Rs.25.40. 

There are many such examples of IPO’s doing just opposite of Grey market premium price. GMP does not mean in anyway a recommendation for an IPO, the financials of a company and its future prospectus tells a lot.

Here is the thing no one can tell you whether the IPO will going to make a stellar debut or not, it is you who have to decide based on available information about the company.

Moreover the IPO’s now a days are very hot market every one wants to earn some quick money on listing day itself and there is nothing wrong about it.

Having said that, one must not forget to check the financials and do not fall for any recommendation from anyone, it is you hard earned money, you should decide whether to opt for the IPO or not.

You may watch various YouTube channels or read on different websites about recommendation for stocks and IPO, it is my humble suggestion and request please do not ever fall prey to it. Better than this is to invest in ETF’s?.

Therefore, whenever you are buying IPO make sure the money invested is not the one which you my need it urgently, always use extra money which you may not require in near future, Otherwise stay away completely.

Laxmi Organic IPO Review – Know Date, Price, GMP, Financial Details In 5 Easy Steps

Now, coming back to the Nazara Technologies IPO let us talk about in brief about the company and its financials and other details step by step.

 



 

About Nazara Technologies Limited (NTL):

Incorporated in 1999, Nazara Technologies Limited is the company engaged in offering interactive games, gamified learning, and new age Sports media and gaming subscription service. Vikash Mittersain is the Chairman and Managing Director of the company.

It has a customer base across emerging and developed global markets such as Africa and North America for companies it acquired partial stakes. Nazara is known for its Chhota Bheem, Motu Patlu, and World Cricket Championship game series.

The company’s monthly active user base stood at 4 crore on average in FY20, which rose to 5.75 crore for the nine-months through Dec. 31, 2020. It is also the 1st purely play gaming company to go public in India.

Some of the subsidiaries and investors of Nazara technology limited are given below:

 

nazara tech ipo details

 

Nodwin – 80% share In India

Sports Keeda – # 1 Esports news site in India

World Cricket Championship: 70% share In India

Kiddopia : Leader in early leaner edutainment space

About Nazara Technologies Limited (NTL)

 

Nazara was started nearly two decades ago with a belief that gaming will become extremely popular in a young nation like ours & today we can see several instances that point to the coming age of gaming in India.

With over 560 Cr downloads a year, India is now topping the global charts when it comes to number of downloads and it is only a precursor of the things to come ahead.

 

About Nazara Technologies Limited

 

Tailwinds for gaming continue to remain strong with number of gamers in 2019 is estimated to be 365 millions up from 280 millions in 2018. India’s game downloads, which reached 5600 millions in 2019,increased 12% over 2018 and amounted to 13% of total game downloads worldwide.

 

Nazara Technologies IPO Review - Online Gaming Company Backed By Jhunjhunwala
Indian Gaming Market –Split By PC, Console & Mobile, 2016-2023 (in USD Million)

 

Nazara Technologies is a much awaited IPO which operates in a niche sector and currently market is appraising unique and digital theme stocks at premium valuations. Gaming may be the theme of coming decade on account of 5G rollover and deep penetration of smartphones and apps in India particularly.

 



 

Financials Of  Nazara Technologies Limited (NTL):

Financials of Nazara Technologies Nazara reported a net loss of Rs 10.1 cr in the first half of FY 2021 compared to a net loss of Rs 24.9 cr in FY 2020. In FY 2020, Nazara reported a 45.85% hike in revenue from Rs 169.70 cr yoy.

 

Financials Of  Nazara Technologies Limited (NTL)

 

It incurred a net loss of Rs 26.61 cr in FY 2020 compared to a net profit of Rs 6.71 cr in FY 2019 40% of Nazara’s revenues comes from India, 40% to 41% from North America and rest from Africa, West Asia, and South Africa. Nazara Technology is a debt-free company.

 

Nazara Technologies IPO Review - Online Gaming Company Backed By Jhunjhunwala

 

In the last 5 yrs, Nazara has invested over Rs 300 cr in the Indian gaming ecosystem. Revenue in FY 19-20 grew by 41.27% over FY 18-19 and FY 19-20. Nazara Technologies delivered total income of Rs. 2,629.65 million in FY 20 which is 41.27% growth over FY 19 (1,860.07 million).

 

 

NTL achieved EBITDA of 126.55 million in the six month period ended September 30, 2020, as compared to 91.14 million in the Financial Year 2020. Whereas, EBITDA margins in the six month period ended September 30, 2020 stood at 6.11%, as compared to 3.48% in the Financial Year 2020.

 

 

Standalone Financials of Nazara Tech:

During the year under review, on Standalone basis the Company has registered a growth by achieving a turnover of 461.21 millions as against 434.47 millions in the previous year. The other income stood at 66.31 millions as against 119.59 million in the previous year.

The total expenditure stood at 422.79 millions as against 522.63 millions in the previous year. Your Company had registered a total profit of 75.91 millions for the financial year ended on March 31,2020 as against ` 22.17 millions in the previous year.

 



 

Consolidated Financials of Nazara Tech:

On consolidated basis, our revenue from operations stood at 2475.09 millions for FY 2019-2020 as against 1698.31 millions for FY 2018-2019. On consolidated basis, the Total Comprehensive Income attributable to the shareholders of the Company is 167.89 million in 2019-20 against 267.09 million in 2018-19

After posting a degrowth of 1.4% in FY2019 the company has posted strong revenue growth of 45.9% in FY2020 to ₹247.5 cr. The company has already posted a revenue of ₹200 crore in H1FY2021.

The company has been reporting losses as they have increased their spending significantly on advertising & promotion from FY2020 onwards which will help drive strong topline growth for the company. At current levels the stock is trading at EV/Sales of 11.5xFY20.

The IPO is valued at 8.4x on H1FY21 (annualised) Price/ Sales which is reasonable when compared to the newly listed technology stocks (average nearly 13).

Moreover, there are enough reasons to turn this into a great issue and on of them is the association of  Rakesh Jhunjhunwala’s whose name is more than enough to draw investors.

The gaming industry is set to witness 30%+ CAGR over 2020-2023 on the back of high mobile penetration, increasing internet penetration and increasing no. of gamers. Having said that, the valuation of the company seems to be very aggressive.

 

Nazara Technologies Peers Comparison:

In India, Nazara Technologies has no comparable listed peers. However, Zynga, an international gaming company, trades at 5.6 times revenue.

 



 

Nazara Technologies IPO Details:

 

Nazara Technologies IPO Details:

 

Object of the offer:

The issue comprises offer for sale by promoters and other shareholders. Nazara Technologies Ltd. will not receive any proceeds from the offer. The company said that listing of equity shares will enhance its brand name and provide liquidity to the existing shareholders.

Issue Break-up

In this issue, 75% is reserved for qualified institutional buyers (QIB), 15% for HNIs and 10% for retail investors.

QIB – 75% of the offer – ₹ 436 crores
NIB – 15% of the offer – ₹ 87 crores
RET – 10% of the offer – ₹ 58 crores

Promoter:

Post issuance of the IPO, the promoter holding in Nazara will reduce from over 22.5% to 20%. The remaining stake will be locked in for 3-yrs.

Mitter Infotech LLP

IIFL Special Opportunities Fund

Good Game Investment Trust

IndexArb Securities and Azimuth Investments

Open Best Free Online 3 in 1 (trading/demat/bank) account within minutes and start investing and trading in stocks, index, mutual funds, ETF’s ELSS, PPF, RD, FD and lot more Now!!! 

 

Frequently Asked Question (FAQ):

1.What Is The Symbol For Nazara Technologies IPO? 

Ans: The Symbol for Nazara Technologies Limited is NAZARA

2.When Nazara Technologies IPO Coming?

Ans: The Issue Period for Nazara Technologies IPO is 17-Mar-2021 to 19-Mar-2021.

3. Post Modification Period For Nazara Technologies IPO?

Ans: The Post issue Modification Period for IPO is 22-Mar-2021 (10.00 A.M. to 11.00 A.M.).

4. What Is The Cut-off Time Period For UPI Mandate For Nazara Technologies IPO?

Ans: The Cut-off time for UPI Mandate Confirmation is 22-Mar-2021 (upto 12:00 PM).

5. What Is The Issue Type For Nazara Technologies IPO?

Ans: The Issue Type is 100% Book Building.

6.What Is The Price Band For Nazara Technologies IPO?

Ans: The Price (Band) Range for Nazara Technologies IPO is Rs.1100 to Rs.1101 per equity share.

7. What Is The Lot Size For Nazara Technologies IPO?

Ans: The Bid Lot i.e. Minimum Order Quantity (lot size) for Nazara Technologies IPO is of 13 Equity Shares and in multiples thereof 13 Equity Shares.

8. Who Are The Book Running Lead Managers For Nazara Technologies IPO?

Ans: The Book Running Lead Managers are, ICICI Securities Limited, IIFL Securities Limited, Jefferies India Private Limited and Nomura Financial Advisory and Securities (India) Private Limited

9. What Is The Face Value For Nazara Technologies IPO?

Ans: The Face Value is of Rs.4 whereas The Tick Size is of Rs.1

10. What Is The IPO Market Timings For Nazara Technologies IPO?

Ans: The IPO Market Timings is 10.00 a.m. to 5.00 p.m.

Open Best Free Online 3 in 1 (trading/demat/bank) account within minutes and start investing and trading in stocks, index, mutual funds, ETF’s ELSS, PPF, RD, FD and lot more Now!!! 

Apart from above points:

The Maximum Subscription Amount for Retail Investor is Rs. 2,00,000

The Maximum Subscription Amount for Employee is Rs. 5,00,000 (Rs.110 Discount Per equity share*)

The Maximum Bid Quantity for QIB Investors is 29,00,807 equity shares in multiple of 13 Equity Shares

The Maximum Bid Quantity for NIB Investors is 13,18,551 Equity Shares in multiple of 13 Equity Shares

The Name of the Registrar is Link Intime India Private Limited

The Contact person name number and Email id is Shanti Gopalkrishnan, +91 22 4918 6200, [email protected]

The Address of the Registrar is C101, 247 Park, L.B.S. Marg, Vikhroli (West), Mumbai – 400 083, Maharashtra

 



 

Where To Check Nazara Technologies IPO Application And Allotment Status?

As an investor or trader generally we are curious and anxious to know the results of the application as soon as possible. To ease the anxiety, both Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have come up with dedicated pages and links which investors can use.

NSE

The NSE has an IPO bid verification module. It can be used to verify the IPO application details uploaded on the exchange bidding system by your member/bank. The data of the bid details uploaded by the member/bank would be available on T+1 day (where T would be date receipt of bid on NSE platform).

In addition, the data would be available until six days after the issue closure date. This gives the investor enough time to verify the data and instruct the member/bank to make any changes, if required.

Exchange will also provide allotment information as provided by the registrar to the issue.

An investor can avail this facility by registering using his/her PAN details. After registration, the investor will receive an email notification from NSE on the registered email address. That email will provide the login details.

The following link can be used for the same:

https://www.nseindia.com/products/dynaContent/equities/ipos/ipo_login.jsp

BSE

The BSE has also come up with a similar platform.

This unique facility allows investors to verify the status of their application submitted to a Trading Member or a SCSB (Self-Certified Schedule Banks).

The investor can check his application status/information on the website until one week after issue close.

The following link can be used by investors:

https://www.bseindia.com/investors/appli_check.aspx

 

Important Things To Keep In Mind Before Applying For IPO’s:

  • Try to fill for the same IPO online from different DP ID i.e. if in your family have more than 1 account you can possibly get the allocation done in case of over subscription.
  • You should have a good knowledge of the sector and the company you are planning to invest.
  • Analysis of the company’s balance sheet is very crucial. A clear understanding of the company’s future projects and vision is very necessary to know whether it will have a sustainable future.
  • Investment decision has to be taken carefully and not in a hurry.
  • Read as much as you can about the company, its objectives for launching the IPO, its past history in business and its futures prospectus.
  • Don’t go for hype in the news, your analysis should be based on facts rather than gossips and rumors.
  • Many IPOs are oversubscribed. What this means is that the demand for shares is much higher than the shares available for sale. In such a situation, it is no surprise that many investors fail to get any shares allotted to them. This is why it is advisable to apply for IPO shares on the last day of bidding. This way, one can have a good estimate on how large the subscription will be. Also, in that case, one should bid for just one lot and not unnecessarily lock up their capital.

 



 

Conclusion:

India is amongst the top five mobile gaming markets in the world with 365 million gamers in 2019 (Source Statista). This number is estimated to rise to 486 million by 2022. In 2019, around 5.6 billion mobile gaming apps were downloaded in India – the highest in the world that represents 13% of the total gaming app downloads as per App Annie estimates.
Gaming contributed to nearly 6% of the time spent by users in 2019 across content categories on the mobile devices. Furthermore, a section of Indian consumers are looking to better utilize their leisure time & are spending that on playing games rather than watching OTT content. The overall gaming industry was $1.9 billion in 2019 and is expected to be $8.4 billion in 2024 (35% CAGR).
Recent lockdown which has augmented virtual item purchase behaviour within gaming apps and has created 80-100 million paying gamers in India. The number of paying gamers will rapidly penetrate rest of the 250 million gamers in coming years as gaming is the cheapest form of entertainment as compared to watching movies in theatres or on OTT platforms.
Indian gaming market is already bigger than Bollywood in terms of revenue thought it is still much smaller than China or US markets. Having said that, games have a much shorter life span as they lose traction and favoritism within the first 2-3 years of becoming popular.

Let us now check some of the strength and risk associated with Nazara Technologies Limited

Some of the qualitative factors and strengths of Nazara Technologies

Presence in a high growth industry

Led by a team of experienced to identify future winning games and capitalize on the same

Some of the Risk Factor for Nazara Technologies

Volatile sales

Unpredictable profitability

 



 

Therefore, it is always advisable to go through Nazara IPO – RHP to know in detail about the company.

The only thing which should be bothering you is the research you did before applying for the IPO. Investing in IPO is risky as well as profitable. Having said that you also need to keep in mind important things mentioned above before applying to IPO’s as the risk is always involved.

For More Information Do Checkout Basics of IPO and FAQ Here.

Do Checkout 2020 IPO Performance List – Despite Corona Most IPO Listed Gave Positive Returns!!

Craftsman Automation IPO Review – Check All IPO Details In 6 Easy Steps

Checkout the List Of 5 Best Stock Brokers In India 2021 here

Open Best Free Online 3 in 1 (trading/demat/bank) account within minutes and start investing and trading in stocks, index, mutual funds, ETF’s ELSS, PPF, RD, FD and lot more Now!!! 

Want to know how much you need to save to reach a specific target than do check moneycontain monthly savings goal calculator here.

NPS Calculator – National Pension Scheme Calculator, Check Your Monthly Pension In 4 Easy Steps

If, you have liked the content please do share it with your friends or on social media, as sharing do bring the good karma. If you have any questions or feedback you can leave them in comment box below.

Note: Please do your own research and make investment. Moneycontain will not be responsible for any of your losses at all. The point made is for educational purpose only and intended to give information. All investments are subject to risks, which should be considered prior to making any investments. The above details are compiled from information available on public platforms. These are not buy or sell recommendations.

How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0

We are sorry that this post was not useful for you!

Let us improve this post!

Tell us how we can improve this post?

Leave a Reply