Nazara Tech Shares Slide On Fears over Online Gaming Bill, Puts PokerBaazi Stake in Limbo

Shares of Nazara Technologies slumped 6% on August 20 after the Union Cabinet approved the draft bill that proposes a sweeping ban on all pay-to-play formats.

The draft version of the Promotion and Regulation of Online Gaming Bill, 2025, is slated for introduction in the Lok Sabha later today. The draft legislation proposes a widespread ban on all pay-to-play formats, covering both games of chance and skill.

If cleared by Parliament, the bill would effectively halt operations of regulated real-money gaming (RMG) platforms across the country. It also seeks to curb advertising of such games and clamp down on financial flows, with banks and intermediaries barred from processing related transactions.

Officials have justified the move by pointing to the addictive design of RMG platforms and the associated risks to mental health, particularly among younger players. Industry representatives, however, criticised the proposal, warning that it could cripple one of India’s fastest-growing digital sectors.

Among listed players, shares of Nazara Technologies fell as much as 6% in intraday trade. While the company reiterated that it has no direct exposure to RMG businesses, it acknowledged an indirect link through its investment in Moonshine Technologies, the operator of India’s leading poker platform PokerBaazi.

Nazara currently holds about 48% in Moonshine, with ₹805 crore already invested and another ₹255 crore committed via compulsorily convertible preference shares. The company had first acquired a 47.7% stake in Moonshine in September 2024 for roughly ₹832 crore.

Brokerage Prabhudas Lilladher flagged the risks of this exposure, highlighting that PokerBaazi accounts for about 35% of its valuation model for Nazara. The brokerage maintained a target price of ₹1,345, but cautioned that if the bill passes and PokerBaazi is forced to shut operations, the fair value for Nazata Tech could fall to ₹917, implying a significant write-off of its investment.

Nazara on the other hand has clarified that since it does not hold a majority stake or exercise control, Moonshine’s revenue is not consolidated in Nazara’s financial statements and has no impact on reported revenue or Ebitda.