Nazara, which has actively been scouting and acquiring companies over the last five years, is now looking to fill some gaps in its casual, social multiplayer, e-sports and real money gaming segments.
“We are looking at expanding our M&A team outside India. All our M&A has broadly happened in India because we are a product of the Indian ecosystem,” said chief executive Manish Agarwal. “We want to really kind of expand our M&A into Europe and US, especially in the mobile gaming space because that’s where you have a long history of game development in Europe for 40 years versus India for four-five years.”
Nazara made its public market debut in March, in the process becoming India’s first publicly listed gaming company. The stock has since almost doubled.
Last week, the company raised funds from Gamnat Pte, an investment firm managed by Singapore’s sovereign wealth fund GIC, and Ahmedabad-based Plutus Wealth Management.
“This money which we have raised is a war chest for us to quickly accelerate the deals. If you notice in the past, our deal is always done with a combination of our equity and cash,” said Agarwal. “Having cash really helps you in closing things because then you can satisfy the demands of the founders or financial security needs of the founders much better if you have some cash upfront that you can give.”
The Indian gaming market is poised to reach $6-$7 billion in value by 2025 from $1.8 billion currently, according to a report by the Internet and Mobile Association of India (IAMAI).
The gaming industry’s growth skyrocketed through the Covid-19 pandemic as people were starved of entertainment options, and the popularity of video games is expected to linger.
Nazara’s IPO in March had a secondary share sale component worth Rs 583 crore, and the company did not raise fresh funds. The new capital will help the company double down on acquisitions.
“What happens is that it’s a chicken and egg. When you find good teams, and if you do not have money, then you can’t close a deal. Because once you have that money, you’ll find a good team, your ability to close the transaction becomes much better and faster,” Agarwal said.