Nazara Tech's 2 subsidiaries hold Rs 64 cr in SVB; stock hits record low

Shares Nazara Technologies hit a record low of Rs 483.05, after they slipped 7 per cent on the BSE in Monday's intra-day trade, amid heavy volumes. The company has said that it's two step-down subsidiaries, Kiddopia Inc and Mediawrkz Inc, hold cash balances at crises-hit Silicon Valley Bank (SVB).

The balances held at SVB by Kiddopia Inc. and Mediawrkz Inc cumulatively account for $7.75 million (around Rs 64 crore), the company said.

Kiddopia Inc is a 100 per cent subsidiary of Paper Boat Apps Private Limited (owned 51.5 per cent by Nazara), and Mediawrkz Inc is a 100 per cent subsidiary of Datawrkz Business Solutions Private Limited (owned 33 per cent by Nazara).

Nazara said thatthe Federal Deposit Insurance Corporation (FDIC) has stated that it would issue an advance dividend to depositors within the next week with future payments coming as asset sales occurred.

"Regardless of the ultimate outcome and its timing, both subsidiaries continue to be well capitalised, and are generating positive cash flows along with profitability. Therefore, we expect no impact on their day-to-day operations, business performance and growth plans due to the SVB event," the company said in an exchange filing. READ HERE

Further, Nazara Group (Nazara Technologies Limited and its subsidiaries) continues to maintain healthy reserves of cash and cash equivalents in excess of Rs 600 crore, excluding the SVB impacted funds, it added.

Shares of Nazara fell below their previous low of Rs 484, touched on June 22, 2022. At 11:52 AM, the stock erased most of its losses, and was trading 2 per cent lower at Rs 507.65. In comparison, the S&P BSE Sensex was down 0.32 per cent at 58,947.

That said, the stock has tanked 44 per cent in the past one year, as against 6 per cent rise in the Sensex. It had hit a 52-week high of Rs 934 on March 11, 2022. The stock had touched a record high of Rs 1,677 on October 11, 2021.

Nazara Technologies is primarily engaged in providing subscription/download of games/ other contents through consumer base in India and worldwide and digital support services to group companies.