Zerodha’s Kamath brothers to invest Rs 100 Cr in Nazara Technologies

Digital gaming and e-sports company Nazara Technologies has raised Rs 100 crore or $12 million from Kamath Associates & NKSquared. This is the first round of investment for the listed company this year.

The board at Nazara Technologies has passed a special resolution to issue 14,00,560 equity shares at an issue price of Rs 718 each to raise Rs  100 crore or $12 million, regulatory filings with the National Stock Exchange (NSE) show.

Kamath Associates & NKSquared are two investment firms managed by Zerodha’s co-founders Nikhil and Nithin Kamath. Both the firm will collectively hold 2.72% of the stake in post-allotment.

As per the filings, the fresh funds will be utilized to invest in funding requirements and growth objectives of Nazara including for making strategic acquisitions and investments in various corporate entities.

Nazara Technologies currently has a market cap of Rs 5,393.5 crore ($652 million) with a share price listed at Rs 815.05 (as of 04/09/2023) at 10:30 AM.

The company has recorded significant growth and registered a 14% scale during the first quarter of FY24. Its operating revenue surged to Rs 254.4 crore in Q1 FY24 from Rs 223.1 crore in Q3 FY23. Its profit also elevated 31.19% to Rs 20.86 crore quarter on quarter.

The Fund infusion for Nazara is coming at a time when online skill gaming focused companies are facing 28% GST (goods and services tax) rule imposed by the Indian government. The entire industry has been crying as they face existential threat after the new tax structure.

In July, more than 100 Indian entrepreneurs, CEOs, and industry bodies involved in real-money gaming wrote to the Indian government to reconsider its decision. Nazara was also a part of the group.