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Rakesh Jhunjhunwala portfolio: Experts see big upside in this tech stock

08 Aug , 2022   By : Kanchan Joshi


Rakesh Jhunjhunwala portfolio: Experts see big upside in this tech stock

Rakesh Jhunjhunwala portfolio: Nazara Technologies shares have remained under block building phase after climbing to its 52-week high in October 2021. The stock hit its 52-week low in June 2022 but after that it has bounced back strongly recording around 40 per cent upside from its 52-week lows in near two months. 


According to stock market experts, this Rakesh Jhunjhunwala stock is expected to come out its long consolidation phase and can go up to Rs911 apiece levels in long term. Nazara Technologies share price today is around Rs672 per share, which means experts are expecting around 35 per cent upside in this tech stock.


Speaking on fundamentals that may fuel Nazara Technologies share price rally in long term, Jinesh Joshi, Research Analyst at Prabhudas Lilladher said, "Nazara reported decent set of numbers with a topline beat of 7.9% and an EBITDA margin of 13.5% which was partially impacted by continued investments to fund growth initiatives of Nodwin. Nonetheless, key highlight was stabilization in unit economics (LTV/CAC of 2x) of Kiddopia after taking a price hike of 13% in June. We believe further headroom exists as Kiddopia’s monthly subscription plan of US$8.99 is still at a discount to other players. Further, even on E-sports front performance was encouraging with 11.7% sequential growth in top-line despite seasonality effect (typically more events accrue in 2H)." However, the market expert maintained that scaling in Freemium business remains sub-par while RMG segment is under the web of regulatory uncertainty restricting further investments, albeit temporarily.


On why Nazara Technologies share price has been skyrocketing in last few sessions, Sonam Srivastava, Founder at Wright Research said, "Gaming Company Nazara Technologies posted impressive numbers for Q1 FY22, which has led to a sharp price rise for the stock in the last couple of weeks. The revenue growth for the stock was 70% compared to the same period the previous year, and the share price rallied 35 per cent in a couple of sessions based on this news." She said that primary drivers of the company’s revenues are e-sports and gamified learning, while the company has started a foothold in ad-tech, freemium and real money gaming. The primary revenue vertical eSports is on a solid footing while other verticals are slowly progressing.


Nazara Technologies share price target


Giving 'buy' tag to this Rakesh Jhunjhunwala portfolio stock, Jinesh Joshi of Prabhudas Lilladher said, "We have increased our sales estimates by 2%/6% for FY23/FY24 respectively as we fine tune our assumptions for E-sports and DataWrkz. Overall, we expect revenue/PAT CAGR of 39%/58% respectively over FY22-24E and believe the growth story remains intact as Nazara’s portfolio approach to gaming not only diversifies unforeseen risks (Apple’s privacy policy or regulatory uncertainty surrounding RMG) but also creates additional growth levers via inorganic route. Consequently, we retain our BUY rating with a DCF based TP of Rs911."


Rakesh Jhunjhunwala shareholding


According to Nazara Technologies shareholding pattern for April to June 2022 quarter, Big Bull Rakesh Jhunjhunwala holds 65,88,620 shares or 10.03 per cent stake in the company.



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