In a significant move that has sent ripples through the Indian gaming industry, Rekha Jhunjhunwala, executor of the late Rakesh Jhunjhunwala's estate, has completely divested her stake in Nazara Technologies . The exit came just weeks before the government's passage of the Online Gaming Bill.

Jhunjhunwala's Exit: Timing and Returns

The divestment, valued at approximately ₹770.00 crore, was executed through multiple transactions. This strategic move by the Jhunjhunwala estate resulted in an impressive four-fold return on their investment, showcasing the growth Nazara had experienced under their tenure.

Market Impact and Stock Performance

The news of Jhunjhunwala's exit had an immediate and substantial impact on Nazara's stock performance:

• The company's stock declined by 14.00% following the announcement
• Over ₹1,700.00 crore in market value was erased
• A 19.00% drop in stock price was observed in the week following the exit

Regulatory Changes and Industry Impact

The timing of the exit is particularly noteworthy, considering the subsequent passage of the Online Gaming Bill. This new legislation introduces stringent measures for the online gaming industry:

• Prohibition of online money gaming services
• Penalties including up to three years imprisonment
• Fines of up to ₹1.00 crore for violations

Nazara's Position and Exposure

Despite Nazara Technologies' primary focus on casual gaming and esports segments, the company faces indirect exposure to the new regulations:

• Indirect impact through its associate, Moonshine Technologies
• Moonshine Technologies owns PokerBaazi, a real-money gaming platform
• Moonshine reported revenue of ₹192.00 crore with an EBITDA loss of ₹73.90 crore
• This exposure represents approximately 35.00% of Nazara's valuation

Other Key Investors

While the Jhunjhunwala estate has exited, other prominent investors remain invested in Nazara Technologies:

• Madhusudan Kela holds a 1.18% stake
• Nikhil Kamath maintains a 1.62% stake

The gaming industry in India is at a crucial juncture with these regulatory changes. Nazara Technologies, despite its focus on casual gaming and esports, finds itself indirectly affected due to its associations in the real-money gaming sector. The coming months will be critical as the industry adapts to the new regulatory landscape, with potential implications for Nazara's business model and market valuation.

Nazara Technologies Limited (NSE: NAZARA) announced a significant development in its gaming portfolio following the recent passage of the Promotion and Regulation of Online Gaming Bill, 2025 by the Indian Parliament. The company's associate, Moonshine Technologies Private Limited, operating under the brand name Pokerbaazi, has suspended its real money online gaming operations in response to the new legislation.

Key Developments

• Moonshine Technologies (Pokerbaazi), in which Nazara holds a 46.07% stake, has ceased real money online gaming operations.
• The decision comes in the wake of the Promotion and Regulation of Online Gaming Bill, 2025, which prohibits all forms of online money gaming.
• Nazara Technologies' shares experienced a sharp decline, falling 3.75% to ₹1,160.00 and marking a 16.50% drop over five trading sessions.

Legislative Impact

The newly passed bill introduces stringent measures for the online gaming industry:

• Bans all forms of online money gaming
• Prohibits advertisements related to such games
• Blocks financial institutions from facilitating transactions for online money gaming
• Imposes penalties of up to three years imprisonment or fines up to ₹1.00 crore for violations

Company's Response

In an official disclosure to the stock exchanges dated August 22, 2025, Nazara Technologies stated:

"As a matter of abundant caution and in due respect of the Government's mandate, Moonshine Technologies Private Limited ("Moonshine/Pokerbaazi"), an associate company in which Nazara Technologies Limited holds a 46.07% stake, has ceased offering real money online gaming operations."

The company further added that it "will evaluate the future course of action following the enactment of the Bill."

Industry Implications

The new legislation has sent ripples through the online gaming industry in India. Gaming companies are expected to seek clarity from the Centre on key provisions of the bill. The move is likely to have far-reaching consequences for the burgeoning online gaming sector in the country.

Market Reaction

The news has had a significant impact on Nazara Technologies' stock performance:

This marks the stock's worst week since its listing.

As the industry grapples with the implications of the new bill, investors and stakeholders will be closely watching how companies like Nazara Technologies adapt to the changing regulatory landscape. The company's future strategies and potential pivots in its gaming portfolio will be crucial in navigating this new era of online gaming regulation in India.