You have clarified that it us about 5.2% of your overall revenue on skill based gaming. So take us through the impact on Nazara.
As you know, this has just been announced yesterday. And it us a bit early for us to be able to define impact on our skill based real money gaming business. But it is important to understand that Nazara is a very well diversified business. We are diversified on three different areas; one is in terms of the different products that we have and the different business models and also the different geographies that we work in. So I think Nazara continues to be a very stable gaming platform that we have built over the years. The skill based real money gaming business contributed to 5.2% of our FY23 revenues. Basis this new policy, there will be some impact and I am sure our teams, as well as the industry will work very closely to mitigate as much impact as we can over here. But from an overall Nazara perspective, I think we can easily take this in our stride without any major financial impact on our performance.I understand that you would be a little close to your earnings but just adjusting for this 5.25% hit what kind of earnings can we expect on an overall basis, in terms of your revenues for the full year?
Again, firstly, we have not given out annual earnings guidance we usually do it in September, like we have done every year after our IPO.
And I think we will have to see how this impact on this 5% of our business plays out. It is still, to be honest, very early to predict it. Probably the next quarter, we should be in a position to share more information on that front.
This announcement itself with respect to GST, are you expecting some sort of representation to be made by the industry because the entire industry has been quite vocal about it? Do you see any chance of a rollback or do you think it us a done deal?
I think this announcement yesterday, of course, did take the entire industry with surprise. The expectation was that this would be applicable on the gross gaming revenue. So it has definitely taken the entire industry by surprise. There are a lot of very active associations in the industry like AIGF, etc. We are also an active member of these organizations. And they will coordinate an industry effort to try and represent the industry’s point of view and try and find a solution.
What do you think? Would this change the consumer behaviour by a whole lot? We were just discussing that people who enjoy playing these games are partly addicted to it as well. Do you think this will materially change the behaviour of the consumer?
I think especially in certain formats it reduces the amount of winnings that will go back to the hands of the consumers by a significant margin. And to that extent, I think the interest of consumers definitely would get significantly dampened.
Just wanted to understand then from a perspective of what do you expect now consumers will resort to. It reduces the winnings, it will impact the behaviour, what do you think the next avenue perhaps is going to be for those who are highly addicted?
I think there are a lot of gaming opportunities on the mobile phone. Consumers are playing all types of games, not just skill-based real money games. But at the same time, this was providing significant entertainment value to the consumers. So we will have to see how it pans out. I really do not have a crystal ball at this point of time but the next few weeks will give us more clarity and I will be happy to come back and speak more about what I have learned.
With respect to the fundraise itself, you are also raising 750 crores odd if I have it right. Could you talk to us about the utilization of that and what are the avenues of raising this fund?
Yes. So, we have grown over the last few years very aggressively on the back of investments in great gaming companies that we have invested in, especially most of our investments in the past have been in the non-RMG space.
And many of these businesses have grown very well. And we have got a playbook that is now working very well. So my team in the last few quarters, especially has done a lot of work with companies in India as well as globally, especially given the market sentiments and attractive valuations that are available. So we are definitely looking at making additional investments, additional M&A activity in many of the segments that we operate in. And hopefully in the coming months, you will see more action on that front as well.