India has the potential to become gaming nation of the world: Nitish Mittersain, Nazara Technologies

“We are also looking at attractive acquisitions that we will do in this year in both these segments to scale our business as well as potentially our margins further,” says Nitish Mittersain, Nazara Technologies.

What is the outlook then, just a quick word on your overall margins because you have been saying that you are looking at expansion very aggressively. Is there anything on the cards right now and where does that take your overall margin picture?
Yes, we are right now on track to meet our margins as we have guided earlier for this year and the company has grown very well in the first nine months. Nazara has grown 80% in revenues, so we are very happy with the balance of revenue, fast revenue growth, remaining profitable and generating positive cash flow. I think that is the right way to approach and FY24 we will continue to do that. We are seeing large opportunities in front of us, like you just spoke on the skill based real money gaming, as well as the casual gaming side. So, we are also looking at attractive acquisitions that we will do in this year in both these segments to scale our business as well as potentially our margins further.

The general view is that the startup funding has dried up, a lot of innovation in the gaming space will not really multiply or will not scale up. Indirectly, are you happy with that because that means existing company like yours who got cash on their books will be able to acquire and will be able to grow?
I think it is a fantastic opportunity for Nazara to invest in the right founders and the right companies and acquire at a fair value. So, clearly, the current market sentiment is actually a very good opportunity for us. But I think even if you zoom out a bit, India is on a trajectory of growth on gaming which is the short-term turbulences of market sentiments and all may just pause it for a little time or slow it down for a little time but I think the long-term growth if you were to zoom out, let us say a five-year view, I think you are on a very strong trajectory which will eventually reach where India has a potential to become a gaming nation of the world.

Five years out if you have to let us say talk about Nazara per se, how much of the forecasted growth will come because of the existing business that is organic growth and how much could come from inorganic growth because you have also been growing by acquiring.
Yes, if you look at our businesses over the last three-four years, every business that we have acquired thereafter has grown very well organically. So, we are very clear about it, that the real value creation does not happen through new acquisitions adding revenue, but those new acquisitions starting to deliver very strong organic growth and we focus very much on those businesses.

As we enter FY24, we see all our businesses having strong growth trajectories, so organic growth will continue to be very healthy and we will also additionally acquire new businesses that can kick in faster and more organic growth in the years to come, so that is how we are thinking. I think a lot of our focus is on organic growth of existing businesses as well as new businesses that we acquire.