‘Making the right moves’: Jefferies is bullish on this Indian tech stock, raising its target price

“While RMG remains an attractive market, Nazara Tech is unlikely to make a big play before regulatory clarity emerges,” the note said. Jefferies raised its estimate to 5-13% and maintained a buy rating on Nazara Tech shares with an upgraded target. Price ₹860 each (from Rs ₹780 earlier) believes that the company is ‘doing the right things’. This year, technology stocks have decreased by about 37%.

After the management took over Nodwin, he highlighted their efforts to transform Nodwin from being just an e-sports event management company to a gaming engagement driven company. He has done content creation around eSports and through his recent acquisitions he offers accessories (Planet Superheroes, Brandscale). Nodwin balance is still over ₹400 m.

“Nazara acquired 100% stake in Wildworks for $10m, representing 0.8x EV/sales. Wildworks is a game developer serving 8-12 year olds with its key IP ‘Animal Jam.’ The acquisition will add US$12m to Nazara’s revenues and help strengthen Nazara’s presence in the gamified classroom in the US, Jeffries added.

The brokerage believes Nazara Tech is a distinct play on the gaming ecosystem, offering exposure to various gaming segments, geographies and revenue streams and strong growth prospects in the eSports segment, driven by strong pick-up in gaming in India and rising value in gamified education. To support subscriber purchases.

He sees better-than-expected revenue growth, particularly in primary education and eSports, improving unit economics in primary education, successful acquisitions and easing regulations on real-money games as key drivers.

The opinions and recommendations presented above are those of individual analysts or distributor companies and not of Mint.

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