The Rakesh Jhunjhunwala-backed Nazara Technologies is back with an IPO plan ⁠⁠— after a series of acquisitions and fundraisings

The Rakesh Jhunjhunwala-backed Nazara Technologies is back with an IPO plan ⁠⁠— after a series of acquisitions and fundraisings
n pic (L-R) – Anupam Dhanuka (Co-founder and CEO, Kiddopia), Anshu Dhanuka (Co-founder and CPO, Kiddopia) and Nitish Mittersain (Founder and MD, Nazara Technologies Ltd.)Nazara
  • Nazara Technologies is backed by Rakesh Jhunjhunwala, one of India’s biggest stock market investors.
  • The gaming and sports media company is looking to join the league of tech startups looking to go public this year. These include Zomato, Nykaa, and Delhivery.
  • This is the second attempt at a market debut. Nazara had earlier filed the DRHP in 2018 but didn't go through with its plans.
  • In the last two years, Nazara has made at least seven acquisitions and raised ₹500 crore in funds.
Indian gaming and sports media company Nazara Technologies has re-filed the Draft Red Herring Prospectus with the Securities and Exchange Board of India (SEBI) as the first step towards its market debut.

Nazara holds the license mobile gaming rights of popular cartoon characters like Chhota Bheem, Motu Patlu and Shikari Shambhu. It has also established itself in 64 countries across Africa, Middle East, South East Asia, and the Indian subcontinent.

The public issue will see a sale of 4.96 million equity shares by Nazara’s promoters and investors.

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This year, Nazara’s IPO debut could kick off a series of tech IPOs in the country as startups like Zomato, Nykaa, Delhivery are headed for the public markets.

The Rakesh Jhunjhunwala-backed Nazara had first filed the DRHP in January 2018 and had even got approval from SEBI for an IPO (Initial Public Offering). However it didn’t go ahead with the launch because of a market slump.

The company has been preparing for its market debut with acquisitions and funding in its kitty.

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Strengthening its capital base

Nazara counts stock broking giant Rakesh Jhunjhunwala, IIFL Asset Management, Sequoia Capital, Plutus Wealth Management as its investors.

Earlier in January 2021, WestBridge Ventures, an early investor in Nazara, had exited the company through a secondary transaction as Plutus pumped in ₹500 crore into the company. According to reports, the exit gave WestBridge 40 times the return on its investment.

Nazara’s stakeholders
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PromoterStake
Mitter Infotech20.57%
Arpit Khandelwal12.51%
Rakesh Jhunjhunwala11.38%
Plutus Wealth Management LLP6.91%
IIFL Special Opportunities Fund6.04%
IIFL Special Opportunities Fund - Series 44.94%
IIFL Special Opportunities Fund - Series 54.16%
IIFL Special Opportunities Fund - Series 2 3.89%
Nitish Mittersain3.49%
Emerging Investment Ltd1.90%
IIFL Special Opportunities Fund - Series 31.87%
Riyaz Suterwalla1.73%
Turtle Entertainment1.68%
Manish Agarwal1.51%
Seedfund2 International 1.27%
Anshu Dhanuka1.02%
Source: Moneycontrol

Nazara went on an acquisition spree

Nazara strengthened its offerings by going on an acquisition drive. It has pumped in over $50 million in startups in the last two years.

In fact, its acquisition spree even got it a ‘next Tencent’ reference in a news report.
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Some of Nazara’s top acquisitions
StartupSectorInvestment
Paper Boat AppsMumbai-based indie studio₹83.5 crore
Sports UnityCreator of multiplayer quiz called Qunami₹7.5 crore
SportskeedaSports media platform₹44 crore
BakbuckLocal languages gaming platformUndisclosed
HalaplayFantasy gaming platform₹40 crore

In November 2019, Nazara technologies said that it plans to invest $20 million in startups next year. This announcement was after in the same year, Nazara had already acquired five companies.

“Looking at the explosive growth in the interactive entertainment and sports ecosystem, Nazara has decided to up its aggression on investing in the emerging market ecosystem and support early stage startups accelerating the growth of these companies and the industry at large,” Nazara Technologies CEO, Manish Agarwal had said then.
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