Rakesh Jhunjhunwala-backed Nazara Technologies is going to open its initial public offer for subscription on March 17, within a price band of Rs 1,100-1,101 a share. The initial public offer of 52,94,392 equity shares will close on March 19, while the anchor book, if any, will open for bidding for a day on March 16. Ace investors Rakesh Jhunjhunwala, who owns a 20% stake in the company, don’t look to sell his stake in Nazara Technologies.
Nazara Technologies, a gaming and sports media platform, looks to raise Rs 582.91 crore in the upcoming public issue. The initial public offering will entirely be an offer for sale (OFS) by existing shareholders and will have no fresh issue of equity shares. Promoters of the company Mitter Infotech LLP will also trim their stake through the IPO.
Nazara Technologies is a gaming and sports platform which is known for its games on World Cricket Championship, Chhota Bheem, and Motu Patlu series. With a presence in India and across emerging and developed global markets such as Africa and North America, with offerings across the interactive gaming, eSports, and gamified early learning ecosystems.
The company has also turned a multi-bagger in the last nine months and now trades at Rs 1,400-1,450 in the unlisted market, up 350 percent from Rs 400-425 in June 2020.
What is the OFFER?
- Investors can bid for Nazara Technologies IPO, beginning from March 17, in the price band of Rs 1,100 to Rs 1,101 per equity share of face value Rs 4. Bids can be placed for a minimum of 13 equity shares and multiples thereafter, translating to a minimum investment of Rs 14,313 per investor.
- It is a complete offer for sale by the existing selling shareholders— 12,67,435 equity shares by IIFL Special Opportunities Fund. 10,36,286 equity shares by IIFL Special Opportunities Fund-Series 4. 8,73,989 equity shares by IIFL Special Opportunities Fund-Series 5. 8,16,804 equity shares by IIFL Special Opportunities Fund-Series 2. 6,91,900 equity shares by Mitter Infotech LLP and 3,93,349 equity shares by IIFL Special Opportunities Fund-Series 3.
- Among others, Good Game Investment Trust will sell 1,50,000 equity shares, Seedfund 2 International 25,000, Porush Jain 23,725, Azimuth Investments 14,959, and Seedfund 2 India will sell 945 shares. Hence, the company will not receive any money from this IPO.
Nazara’s Grey Market Premium is Strong:
Grey market premium (GPM) is a premium amount at which grey market IPO shares are traded before they get listed in the stock exchange.
Earlier in February, Nazara Technologies shares were trading at Rs 1,060 apiece in the unlisted space even before the price details were announced. In the grey market, shares of the gaming firm are running with a premium of Rs 620 per share.
Big Bull Rakesh Jhunjhunwala owned nearly 20 per cent stake in the company as of last March.
“Nazara may trade at an even higher multiple vs expectations, as it is a pure-play digital company offering the potential of 30% revenue growth CAGR as per its own estimates. Global gaming and eSports companies are trading at 3.3x one-year forward EV/sales despite much lower growth rates than those in India,” as per the reports.
The company’s consolidated revenue for the financial year 2019 stood at Rs 183 crore, on which it generated Rs 4.2 crore PAT(Profit after Tax). For the year 2018, these figures stood at Rs 180 crore and Rs 1.2 crore, respectively.
“The stock has been a hot property of late. The company has a lot of potentials. Whopping fundraising by gaming companies like Roblox may pump up the valuations.”– Sunil Chandak Mumbai-based Investor.