Online Gaming Bill, Nazara Technologies Share Prices: Shares of Nazara Technologies Ltd tumbled nearly 9 per cent on Wednesday after the government tabled a draft Bill in the Lok Sabha proposing a blanket ban on all online real-money gaming (RMG) in India. As of 2:01 PM IST, Nazara was trading at Rs 1,274.90, down Rs 124.80 (8.92 per cent) on the NSE.
In contrast, Delta Corp Ltd — primarily an offline casino operator — edged higher by 0.33 per cent to Rs 93.19, while the Nifty 50 index rose 0.36 per cent to 25,070.40, underscoring sector-specific pressure on online gaming stocks.
Draft Bill to Ban Online Money Gaming
The draft legislation, cleared by the Union Cabinet and introduced in Parliament today, criminalises the offering, aiding, abetting, or facilitating of any online real-money gaming services. It also prohibits banks and financial institutions from processing related transactions.
This crackdown comes at a time when the sector is already facing several challenges, which is already subject to a 28 per cent GST imposed in October 2023. Reports indicate the government may hike this GST to 40 per cent, placing online gaming alongside “sin goods” such as tobacco and alcohol.
Nazara Tech’s Exposure to PokerBaazi Raises Concerns
Brokerage reports highlight that about 35 per cent of Nazara’s sum-of-the-parts (SoTP) valuation comes from its indirect exposure to PokerBaazi — operated by Moonshine Technologies Pvt. Ltd., in which Nazara holds a 46.07 per cent stake. Nazara has invested roughly Rs 830 crore in Moonshine, with additional reports indicating plans to infuse another Rs 150 crore.
Now this bill coming into picture, the investment faces major risk of write-offs. Nazara management, speaking in an interview with Zee Business, emphasised that the company has no direct exposure to real-money gaming. Real-money gaming did not contribute to revenue or EBITDA in Q1, and Moonshine’s revenues are not consolidated in Nazara’s standalone financials.
The company’s indirect exposure through Moonshine means the direct financial impact on Nazara’s core business is limited, and the management suggested that if consumer spending shifts away from real-money gaming, other segments within Nazara’s portfolio could benefit.
Sector Impact and GST Hike
The draft Bill affects unlisted RMG companies like Dream11, MPL, RummyCircle, and PokerBaazi most directly. With the government also contemplating a GST increase to 40 per cent on online real-money gaming, the regulatory environment remains challenging.
