Share Price of Nazara Technologies Jumps 20% as Company Announces Record Date for Bonus

The intraday share price of Nazara Technologies spiked 20% as the company fixed June 27 as the record date for the issue of 1:1 bonus shares.

This stock price jumps 20 percent

Rakesh Jhunjhunwala held Nazara Technologies Jumps 20% in a Day, 1:1 Bonus Announced
Nazara Technologies, a gaming stock held by Rakesh Jhunjhunwala, has fixed June 27 as the record date for the 1:1 bonus issue. This means that if you are holding shares of this company by the closing of June 27, you are eligible to earn one additional share for every share held by the company.

Share Price of Nazara Technologies Jumps 20% in a Day

After the stock was adjusted for the bonus issue, the shares of Nazara Technology, an online gaming company, rose sharply by 20% intraday on June 24.

When writing this report, the stock was trading at Rs 614.25, a 17.92% spike against the previous closing price of Rs. 520.90.

1:1 Bonus Issue, Record Date Announced

The 1:1 bonus issue for shareholders holding stocks as of June 27, 2022 (the record date) was announced by Nazara Technologies on May 13, 2022. As a result, the stock's previous closing price halved to Rs. 520.90 against the earlier price of Rs. 1041.80.

High and Low Prices

The company’s share price touched a high of Rs 1601.13 on October 11 last year. It reached the lowest closing price on June 22, 2022. It was Rs 500.38. Over the previous eight months, the stock price of Nazara Technologies plummeted by 69%, mainly due to the volatile market. After striking the lowest point since listing, the stock has rebounded now. 

Brokerage Estimates

Prabhudas Lilladher, a brokerage company, has increased its EPS (earnings per share) estimates by 2-3%. According to its expectations, PAT CAGR and sales will be 54% and 35% respectively over the financial year 2022-24. The brokerage also stuck to its previous buy call for Nazara Technologies.

TV Broadcasting and Viewership

According to the Prabhudas Lilladher brokerage company, Esports will emerge as a growth engine despite the growth challenge in Kiddopia. It is mainly because prime-time TV broadcasting will speed up viewership and popularity in the future.

BGMI Master Series and Partnerships with Other Companies

After a meeting with the CEO of Nazara, Manish Agarwal, Prabhudas Liladher thinks that the BGMI (Battle Grounds Mobile India) Master series IP, to be held soon, is expected to be profitable for the first year itself. 

The production cost of the event would be around 15-20 crores, as indicated by management. the brokerage added that this will not only increase Esports’ popularity but also boost Nazara Technologies’ media rights licensing revenue.

A subsidiary of Nazara, Nodwin Gaming, has partnered with Star Sports to live telecast the BGMI Master series for the first time on Indian TV. To broadcast Esports events, Nazara has partnered with other behemoths such as YouTube, Viacom, and HotStar. This is the first time such an event will be telecast live in association with Star Sports on linear television.

Revenue and Spending

Analysts at Prabhudas Lilladher suggest that the incremental revenue is expected to be 60-70 crore in 2023 for Esports’s offline events. For Kiddopia, the brokerage believes that additional expenses have been reduced. There has been an expectation mismatch even in the brand-building activity. So, the company has also not spent any more money in this area.

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