Nazara ups its game on a rough pitch

EVEN AS IT charts a turnaround strategy, Nazara Technologies is looking to expand the gaming & e-sports production businesses overseas. Last week, its subsidiary Nodwin Gaming bought Ninja Global, an acquisition that will give the company a foothold particularly in the West Asian and Turkish markets.

- JATIN GROVER

Meanwhile, Nazara's performance in the last couple of quarters has been less than exciting. In the December quarter, the top line rose by an anaemic 1.8% year-on-year (y-o-y). Specifically, adtech revenues were down a sharp 44%y-o-y thanks to the shift in focus towards high margin customers and the loss of a large client. Gaming revenues fell 12%. However, the revenues from the core e-sports business rose a good 27% y-o-y aided by Sportskeeda and Nodwin.

Again, Kiddopia, the learning app for children, saw a sequential fall in the subscriber base. It has now lost 38,509 subscribers in the last three quarters leaving the base at 273,000 in December 2023.

The concerns, especially, the 28% GST levy on the full bet value for the real money gaming piece-Classic Rummy- are unlikely to fade away soon. The company has no plans to pass on the GST burden to consumers and awaits clarity on the matter. The absence of revenue from media rights owing to delays in large TV/OTT deals for hosting games could persist for awhile as could the weakness in telecom subscriptions.

As Jinesh Joshi at Prabhudas Lilladherhas pointed out, the problems such as the 28% GST levy or for that matter the change in Apple's privacy policy, might not be easy to resolve.As such, Joshi expects the company's top-line to grow at a modest pace of 14% CAGR over the next 3 years, which is way below Nazara's target of 30%.