Mumbai-based gaming company Nazara Technologies reported a consolidated profit after tax (PAT) of INR 50.7 Cr in FY22, up 273% year-on-year (YoY).
Nazara’s revenue from operations grew 37% YoY to INR 621.7 Cr in FY22, primarily helped by growth in its esports business segment.
Nazara’s esports business revenue grew about 79% to INR 303.9 Cr in FY22, contributing to about 49% of its total operating revenue despite witnessing a negative impact from the Covid-19 pandemic. Growth in the esports segment was followed by the gamified early learning segment, which reported a revenue of INR 204.4 Cr in FY22, contributing about 33% to the total operating revenue.
The company’s revenue jump comes at a time when the gaming industry is already facing headwinds from changes in Apple’s app store policies and India’s overall challenging regulatory environment for real money gaming.
Revenue from its real money gaming business more than doubled to INR 29.7 Cr in FY22, contributing 5% of the total operating revenue as against 3% in FY21.
Nazara is a diversified gaming and sports media platform with its presence in India and across both emerging and developed global markets such as Africa and North America.
On the expense front, the company incurred a total expense of INR 575.4 Cr in FY22 versus INR 449.5 Cr in FY21. Like the previous fiscal year, the most considerable portion of Nazara’s expenses was in advertising and business promotion.
A total of INR 201.7 Cr was spent on ads and business promos in FY22, compared to INR 226.5 Cr in FY21.
The company reported cash on hand of INR 732.1 Cr as of March 31, 2022.
In Q4 2022, the company reported a 42% YoY increase in revenue from operations at INR 175.1 Cr, while PAT grew 17% to INR 4.9 Cr.
Shares of Nazara surged following the announcement of the results, ending over 13% higher at 1,244.35 on the BSE on Friday.
“Our strategy of diversifying portfolio across business categories continues to give us a solid and robust momentum to grow faster than the overall gaming and esports market in coming years,” Nazara CEO Manish Agarwal said in a statement.
Last month, Nazara’s subsidiary, esports gaming platform NODWIN Gaming, acquired a 35% stake, valued at INR 10.01 Cr, in gaming accessories brand Wings, owned by Brandscale Technologies.
The deal was primarily aimed at scaling up and strengthening NODWIN’s retail presence and accelerating its direct-to-consumer approach for the gaming and esports audiences in India.
Earlier last month, Nazara Pte. Ltd, the Singapore-based wholly-owned subsidiary of Nazara, invested $2.5 Mn in US-based gaming fund BITKRAFT Ventures.
In January this year, Nazara also acquired a 55% stake in programmatic advertising and monetisation startup Datawrkz, which helped it reach a valuation of up to INR 225 Cr.
The Indian esports market is expected to reach $175 Mn in terms of aggregated revenue by 2023, according to an Inc42 plus analysis.
The popularity of games such as PUBG Mobile, Clash of Clans and others has brought esports to the mainstream in India.
According to a 2021 KPMG report, the number of online gamers in India grew to about 400 Mn by mid-2020 from about 250 Mn in 2018, making it the second-largest base of online gamers after China. It also said that the country’s online gaming market is expected to reach about $3.9 Bn by 2025.
