There are some interesting IPOs scheduled to be launched in 2021. One such IPO is the Nazara Technologies Limited IPO that is being launched on March 17, 2021. Here is all you need to know about the issue.
IPO Date | March 17, 2021 to March 19, 2021 |
Issue Type | Book Built Issue IPO |
Issue Size | 5,294,392 Equity Shares of Rs.4 totalling up to Rs.582.91 Crore |
Offer for Sale | 5,294,392 Equity Shares of Rs.4 totalling up to Rs.582.91 Crore |
Face Value | Rs.4 per equity share |
IPO Price | Rs.1100 to Rs.1101 per equity share |
Market Lot | 13 shares |
Min Order Quantity | 13 shares |
Listing At | BSE, NSE |
Companies | Type | Bidding Dates | |
SME | Closes 20 Sep | ||
SME | Closes 23 Sep | ||
SME | Closes 24 Sep | ||
SME | Closes 24 Sep | ||
SME | Closes 24 Sep |
Bid/Offer Launch date | March 17, 2021 |
Bid/Offer Last date | March 19, 2021 |
Basis of Allotment finalization date | March 24, 2021 |
Initiation of Refunds | March 25, 2021 |
Credit of Shares to Demat Acct | March 26, 2021 |
IPO Shares Listing Date | March 30, 2021 |
Nazara Technologies Limited is a diversified gaming and sports media platform. It has a presence in India and across emerging and developed global markets like North America, Africa, etc. The company offers a wide range of interactive games, eSports, and gamified early learning ecosystems including World Cricket Championship (WCC), and CarromClash in mobile games, Kiddopia in gamified early learning, Nodwin and Sportskeeda in eSports and eSports media, and Halaplay and Qunami in skill-based, fantasy, and trivia games. Nazara tech has a market-first position in India across sports simulation and eSports.Â
The company’s expansion into global markets has been strategic, both in terms of geographies as well as timing for entering new markets. It has built capacities and capabilities across its offerings in India, targeting gamers within the country, and then replicated the business model in global markets to target gamers. Here are the segments in which the company has managed to carve a niche for itself:
Nazara Technologies Limited was originally established in 1999 as Nazara.com Private Limited and subsequently changed to Nazara Technologies Limited in 2017 as it was converted to a public limited company. In 2004, the company launched pay-per-download Java games with BPL and Hutch and signed a contract with Sachin Tendulkar for three years.
By 2005, the company had received its first round of investment from WestBridge and signed an exclusive agreement with M.S. Dhoni. The next year, it started working with telecom operators such as Tata Teleservices Limited and Vodafone.
In 2007, Nazara Tech received its second round of investments from WestBridge and started working with Bharti Airtel as a telecom partner. In 2008, the company signed an exclusive wireless content distribution agreement with Electronic Arts Asia Pacific Pte Ltd. to market, distribute, reproduce, and sublicense its contents in India through specified distribution channels.
By the next year, in 2009, Nazara Tech launched the subscription-based ‘Games Club’ model on Reliance Communications Infrastructure Limited. Over the next four years, it expanded overseas and commenced business in the Middle East, Zambia, Uganda, Nigeria, Singapore, Mauritius, and Kenya.
By 2015, the company had signed a licensing deal with Virat Kohli and Hritik Roshan and executed an exclusive licensing agreement for Chota Bheem. Over the next five years, Nazara Tech made the following acquisitions:
Here is a quick look at the financial performance of Nazara Technologies Limited over the last three years:
Mar 2020 | Mar 2019 | Mar 2018 | |
Total Assets | 776.83 | 514.58 | 470.76 |
Total Income | 262.15 | 186.10 | 181.94 |
Total Expenses | 281.15 | 174.28 | 133.37 |
Profit After Tax | -26.61 | 6.71 | 1.02 |
All amounts in INR Crore
A quick glance at the financial performance of Nazara Technologies over the last three years offers the following insights:
The gaming industry that was once considered to be a form of escapism has now evolved into becoming a key component in the economic transformation of the world. The gaming industry develops, designs, publishes, distributes video games across devices, leverages eSports for the marketing of video games, and deploys gamification techniques to influence consumer behaviour in various verticals like edutech, healthtech, fintech, consumer loyalty, defense, etc.
Over the last two decades, the gaming industry has progressed from a primitive arcade style of entertainment to a graphically immersive and social form of entertainment. With an estimated market size of approximately USD 160 billion in 2020, the gaming industry is one of the largest and fastest-growing segments within the media and entertainment sector.
While the pandemic pulled the brakes on many businesses, the online gaming industry benefited as people stuck at home turned to gaming platforms for entertainment. The Indian Bollywood film industry was valued at USD 2 billion in 2016 and is projected to reach a size of USD 2.7 billion by 2023. The gaming industry in India was nearly 25% of the Indian film industry in 2016, but by 2023, it is expected to exceed the Bollywood revenues by USD 0.8 billion and reach a value of USD 3.5 billion. This tremendous increase will be predominantly driven by the proclivity of the Indian population to adopt gaming as their primary source of entertainment.
The CAGR for India’s mobile gaming market stands close to 40% YoY. Being a relatively nascent market, the growth rate for mobile gaming in India closely reflects the growth that China had between 2013 and 2020 (CAGR ~ 41%). Compared with the early rise of mobile games in the USA which had a CAGR of 21% between 2013 and 2020, the Indian mobile gaming market is projected to have healthy growth in the future.
A comparison with the Chinese mobile gaming market of the last decade shows that the Indian mobile gaming market is currently where the market in China was 8 to 10 years ago. Between 2012 and 2013, China had around 300 million mobile gamers which is approximately the number of mobile gamers in India in 2020. Similarly, in 2012, the Chinese mobile gaming market had revenues of USD 1.3 billion which is approximately close to the revenue for the Indian mobile gaming market in 2020.
Based on how the mobile gaming market in China has taken off in the last few years, and with the Indian mobile gaming market reflecting the Chinese mobile gaming market of the early 2010s, it is fair to assume that the Indian mobile gaming market will have a growth similar to that of China and will see equivalent traction.
According to the Red Herring Prospectus, there are no listed companies in India that engage in a business similar to that of our Nazara Technologies Limited. Hence, it is not possible to provide an industry comparison in relation to it.
As there are no listed peers, we cannot compare the P/E ratio of Nazara Tech with the industry average. However, the company has a negative P/E ratio and hence, investors must conduct a thorough fundamental analysis of the company before applying.
Since the IPO only includes an Offer for Sale by the existing shareholders, the objects of the offer are:
The company will not receive any proceeds from the IPO.
You can apply for the Nazara Technologies Limited IPO by using one of these two methods of payment:
Here are some things that you need to keep in mind before investing in the Nazara Technologies IPO:
Q1. What is the Nazara Technologies Limited IPO?
The Nazara Technologies Limited IPO is a Main Board IPO of 5,294,392 equity shares having the face value of Rs.4 totaling up to Rs.582.91 crores. The registrar for the IPO is Link Intime India Private Limited and the shares are proposed to be listed on the BSE and NSE.
Q2. What are the open and close dates of the Nazara Technologies Limited IPO?
The Nazara Technologies Limited IPO opens on March 17, 2021, and closes on March 19, 2021.
Q3. What are the lot size and minimum order quantity of the Nazara Technologies Limited IPO?
The lot size of the Nazara Technologies IPO is 13 shares. Also, the minimum order quantity is 13 shares.
Q4. What are the allotment and listing dates of the Nazara Technologies Limited IPO?
According to the DRHP, the basis of allotment will be finalized by March 24, 2021. Further, investors can expect to receive the credits in their demat accounts by March 26, 2021. The shares may get listed on March 30.