Nazara Tech Aims To Double Core Profit On Back Of Ad Tech

A key driver of growth for Nazara Tech will be the gaming and sports media company's ad-tech division. "Today, the Ebitda margins on our ad-tech business are sub-10%. But I think over a three-year period, we should be able to get over 15% to 20% kind of number."

The company is currently focused on creating synergies between the recently acquired company Space & Time and its ad-tech platform, Datawrkz.

Alongside ad tech, Nazara is "doubling down" on its core gaming business. The company's strategy involves actively acquiring global gaming intellectual property and studios. Mittersain described the core gaming business as the top-performing segment, offering the highest margins and best cash flows.

"The other businesses, whether it's the ad-tech business or an esports business, are run by strong management, are well capitalised and are independently running businesses," he said.

The top executive also highlighted the opportunities that the Indian gaming market offers.

"The Indian gaming market is expected to grow the fastest in the world. We already have 500 million gamers. Monetisation has lagged, but it is starting to pick up. I think India will become a large revenue-generating market in the gaming world over the next five years," he said.

"I think Nazara can be the first globally respected gaming company out of India," Mittersain asserted. 

Nazara's expansion strategy has proven successful, with past acquisitions like Kiddopia, Sportskeeda and Nodwin Gaming scaling significantly post-acquisition. The recent investment in a near-majority stake in PokerBaazi underscores the company’s aggressive expansion, despite the online poker platform's lack of profitability currently.

"We have been a very acquisitive company. We absorb a lot of intangibles into our book and there is a significant amount of intangible amortisation that's happening below Ebitda," he said. "Therefore, I think some of these return ratios are currently skewed and don't really tell the true health of our business."