NAZARA

We cut our PAT estimates by 15%/6% for FY26E/FY27E as we re-align our depreciation forecast & profitability assumptions for Nodwin and downgrade NAZARA to a HOLD (earlier BUY) with a revised TP of Rs1,241 amid 26% rise in stock price over the last 1 month. NAZARA reported an EBITDA margin of 9.8% (PLe 9.0%) while PAT was impacted by an impairment charge of Rs153mn pertaining to the erstwhile accessories business. We expect sales CAGR of 27.5% over next 2 years led by the recent acquisition of Curve Games with an EBITDA margin of 10.6%/12.3% for FY26E/FY27E. Given the improvement in CPT to US$33.7, price rise to US$12.99 per month and expanding IP integrations, we have increased our target EV/sales multiple of Kiddopia to 3.5x. Outlook Further, we have incorporated the acquisition of Curve Games into our SoTP valuation matrix and arrive at a blended TP of Rs1,241 (refer exhibit 6 for more details). Downgrade to HOLD.