Hold Nazara Technologies; target of Rs 878: Prabhudas Lilladher

Prabhudas Lilladher recommended hold rating on Nazara Technologies with a target price of Rs 878 in its research report dated July 03, 2024.

Broker Research

July 04, 2024 / 12:23 IST

hold

26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on Nazara Technologies

We believe the acquisition not only paves the way for Nodwin to access developed markets where Esports has better penetration, but also lends expertise in PC-based games. The buyout has also re-ignited growth prospects of the Esports segment, which has been facing some challenges off late due to deferment in media rights deals. Post consolidation, we expect revenue/EBITDA CAGR of 23.7%/45.1% over FY24-FY26E. Given sharp appreciation in stock price we downgrade to a HOLD and believe rerating from hereon will hinge on capital allocation decisions, as Nazara has a cash balance of Rs14.5bn.

Outlook

We increase our EBITDA estimates by 4.5%/6.0% for FY25E/FY26E taking into consideration the acquisition of Freaks and downgrade Nazara to HOLD with a revised TP of Rs878 (earlier Rs806) amid 31% appreciation in stock price since our last update.

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