Nazara Technologies
Stock Snapshot
Price Performance
Vista Outlook
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Nazara Technologies is navigating a transformative phase marked by strategic acquisitions, including Blue Tile and Best Play, which management anticipates will drive a 54% sales CAGR through FY28. However, the company is currently grappling with margin pressures due to aggressive user acquisition spending and investments in new titles. Despite these challenges, the focus on scaling high-potential gaming assets, such as 'Big Brother' and 'The Traitors', underscores a commitment to long-term growth and market share expansion. Vista's financial outlook reflects stable revenue growth consistent with historical performance, although margins are expected to remain under pressure. The current valuation suggests a value trap, with a significant expected downside of approximately 48%. The macro environment in India remains supportive, but external factors, including negative foreign institutional flows, warrant caution. Over the next 12-24 months, key opportunities include the successful integration of acquisitions and the launch of Smaaash 2.0, while watchpoints include the potential for increased debt and volatility from associate losses
Why We Like This Stock
- Strategic acquisitions are expected to drive significant revenue growth, with a projected 54% CAGR through FY28
- Focus on scaling high-potential gaming assets indicates a commitment to enhancing market share
- The macro environment in India remains supportive, providing a conducive backdrop for growth
Things To Watch Out For
- Current margin pressures due to aggressive user acquisition spending may impact short-term profitability
- Increased debt levels from acquisitions could pose financial risks
- Negative foreign institutional flows may affect market momentum and investor sentiment
Key Parameters
Financial Snapshot
| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 1,138 | 1,624 | 1,829 | 1,816 | 2,385 |
| Profit Before Tax (Cr.) | 95 | 61 | 961 | 350 | 620 |
| PBT Margin | 8.3% | 3.8% | 5254.2% | 19.3% | 26.0% |
| Net Profit (Cr.) | 43 | 17 | 895 | 263 | 458 |
| Earnings Per Share | 0.7 | 1.1 | 24.5 | 7.0 | 12.4 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Choice Equity | ▲ Buy | 400 | 18-May-2026 |
| ICICI Securities | ► Hold | 330 | 27-May-2026 |
| Prabhudas Liladhar | ▲ Buy | 378 | 07-Aug-2026 |
Company Overview
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Nazara Technologies Limited operates a gaming and sports media platform in India, Africa, the Middle East, the Asia Pacific, the United States, and internationally. It operates through gaming and other segments. The company offers subscription, download of games, and support services. It also provides interactive and online gaming, including gamified early learning ecosystems; e-sports; and advertising technology ecosystems. In addition, the company owns various IPs, including World Cricket Championship, Kiddopia, Animal Jam, Classic Rummy, Openplay, Halaplay, Nazara Telco Distribution, Nodwin, NODWIN Gaming, SportsKeeda, Ultimate Teen Patti, PokerBaazi, Crash Arena Turbo Stars, King of Thieves, Curve Games, Love Island, Big Brother, Fusebox Games, Funky Monkeys, Curve Games and Smaaash, Branded, Pro Football Network, Soap Central, Datawrkz, and Space and Time. The company was incorporated in 1999 and is based in Mumbai, India with additional offices in Dubai, United Arab Emirates and Singapore.