Nazara Technologies said it will raise the capital via qualified institutional placement, or preferential allotment, or a combination of both
The board also gave its assent to the company’s proposal to increase its authorised share capital to INR 50 Cr from INR 30 Cr
While the company didn’t specify the reason for raising fresh funds, the capital is likely to be used to fuel its acquisition spree and shore up growth
Gaming giant Nazara Technologies on Monday (July 10) said its board has approved a proposal to raise up to INR 750 Cr.
In a regulatory filing with the exchanges, the company said it will raise the capital via qualified institutional placement, or preferential allotment, or a combination of both. The startup will also explore any other permissible means to raise the funds.
Further aspects of the deal will be subject to the approval of shareholders.
The board also gave its assent to the company’s proposal to increase its authorised share capital to INR 50 Cr from INR 30 Cr.
“… we wish to inform you that the Board of Directors of Nazara Technologies… considered and approved… increase in authorised share capital from INR 30 Cr to INR 50 Cr and corresponding amendments to the Clause V of the Memorandum and Articles of Association of the Company subject to the approval of shareholders,” said Nazara in a filing.
The company said it will raise the funds by issuing equity shares of face value of INR 4 each up to a cumulative value of INR 750 Cr.
While the company didn’t specify the reason for raising fresh funds, the capital is likely to be used to fuel its acquisition spree and shore up its growth. The gaming company, in March 2023, said it would acquire 73.27% stake in Pro Football Network LLC via subsidiary SportsKeeda.
It followed this up by increasing its stake in Next Wave Multimedia to nearly 72% in May this year.
Nazara is the second startup in recent days, after PharmEasy, to have sought the permission of its board to increase authorised share capital to raise funds. However, unlike PharmEasy, which faces a potential debt crisis, Nazara is profitable and has been focusing on expansion for inorganic growth.
Nazara reported a consolidated net profit of INR 61.4 Cr in the financial year 2022-23 (FY23), up 21% from INR 50.7 Cr in FY22. Revenue from operations soared 75% to INR 1,091 Cr in FY23 from INR 621.7 Cr in the year ended March 2022.
Nazara operates in the larger Indian gaming and allied markets, which have seen a massive growth in popularity in recent years on the back of cheap smartphones and data tariffs. As per a report, India was home to more than 507 Mn gamers at the end of FY22, with the industry expected to grow to a market size of $8.6 Bn by FY27.