The selloff comes after the Union Cabinet cleared the Promotion and Regulation of Online Gaming Bill, 2025, which will be tabled in Parliament for debate. The bill seeks to regulate gaming platforms with monetary incentives, citing concerns around mental health, money laundering, and fraudulent transactions.
The tighter framework is expected to bring greater compliance requirements, potentially denting sentiment across the digital gaming industry.
The pressure on Nazara has intensified even though the company clarified that the new rules will have no direct impact on its revenues or EBITDA.
According to Harshal Dasani, Business Head at INVasset, “Nazara Technologies is facing sustained selling pressure despite clarifying that the newly passed Promotion and Regulation of Online Gaming Bill, 2025 will have no direct revenue or EBITDA impact. The stock slipped nearly 15% in recent sessions as investor sentiment soured on the broader online gaming space.”
Adding to the intrigue is the role of ace investors. Rekha Jhunjhunwala, who once held a 7.06% stake, fully exited her investment in June 2025, cashing out nearly Rs 334 crore at an average price of Rs 1,225 per share.Her exit brought an end to the Jhunjhunwala family’s association with the stock.In contrast, marquee names like Madhusudan Kela and Zerodha co-founder Nikhil Kamath continue to hold their stakes, signalling confidence in Nazara’s long-term prospects.Market fears have largely centered on Nazara’s associate company Moonshine Technologies, which operates PokerBaazi. Nazara holds a 46.07% stake in Moonshine through equity and preference shares worth over Rs 1,000 crore, raising worries about a potential write-down if real-money gaming takes a hit.
Dasani notes, however, that the overhang is “more from perception than fundamentals,” as real-money gaming contributes nothing to Nazara’s consolidated revenues. Instead, the company’s growth is anchored in e-sports, adtech, gamified learning, and publishing.
What should investors do?
Analysts suggest that traders may need to exercise caution until regulatory clarity emerges, as volatility could persist in the short term.
But for long-term investors, Nazara’s diversified revenue base and strong balance sheet provide comfort.
“Sustained delivery on earnings and reduced noise around Moonshine will be key triggers for sentiment recovery,” Dasani adds.
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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
