Big Blow! Nazara Tech shares crash 13% on Bill to ban money-based online gaming; check details

The stock of Nazara Tech ended 12.84% lower at ₹1,220 on the NSE.

The shares declined because the government on Wednesday moved legislation in the Lok Sabha to ban online games played with money as it looks to check rising instances of addiction, money laundering, and financial fraud through such applications.

The Promotion and Regulation of Online Gaming Bill, 2025, also seeks to prohibit advertisements related to online money games as well as bar banks and financial institutions from facilitating or transferring funds for any such games.

An online money game is one played by a user by depositing money in expectation of winning monetary and other enrichment.

Union Minister Ashwini Vaishnaw introduced the Bill in the Lok Sabha amid sloganeering by MPs belonging to opposition parties in protest against alleged irregularities in electoral roll revision in Bihar.

The Bill outlaws all online betting and gambling (satta and jua) activities -- from online fantasy sports to online gambling (like poker, rummy and other card games) and online lotteries.

Nazara Tech shares slipped even when the company issued a clarification this morning. In its filing to stock exchanges, the company said the following.

• Nazara has no direct exposure to real money gaming (RMG) businesses. As per its latest reported financials (Q1-26), the contribution to revenue and EBITDA by the RMG business is NIL.

• The company’s only indirect exposure to RMG is through its 46.07% stake in Moonshine Technologies Private Limited (PokerBaazi).

As Nazara does not hold a majority stake or exercise control, Moonshine’s revenue is not consolidated in the company’s financial statements and has no impact on the company’s reported revenue or EBITDA. The contribution to PAT by Moonshine as a share of profit & loss by associate is negative in Q1-26, it said.

• The company has invested ₹805 crore towards equity shares in Moonshine through a combination of cash and stock and, in addition, holds compulsory convertible shares amounting to ₹255 crore.

Accordingly, the company does not anticipate any material adverse impact on its operating financial performance (revenue or EBITDA) in relation to such media reports, Nazara Tech added.

Once the legislation is passed by both Houses of Parliament, offering or facilitating online money gaming will be punishable by imprisonment of up to 3 years and/or a fine of up to ₹1 crore.

The Bill proposes that any person offering an online money gaming service in violation of the stipulated provisions will face imprisonment of up to three years or a fine that may extend to ₹1 crore, or both. The provisions also stipulate imprisonment of up to two years and/or a fine of up to ₹50 lakh, or both, for those indulging in advertisements in contravention of rules.

Additionally, those engaging in any transaction or authorisation of funds will be liable for up to three years' imprisonment, or a fine of up to ₹1 crore, or both, according to the source.

Repeat offences for violations related to online money gaming attract more stringent jail terms (3-5 years) as well as fines.

The Bill, however, does not criminalise anyone playing online money games, to avoid any harassment. The idea is to treat them as victims, rather than perpetrators of crime, the source said, adding that the Bill cracks down on those promoting and abetting it.

It prohibits banks and financial institutions from processing or transferring funds related to real-money online games.

The PTI report said that the Bill aims to regulate online gaming by promoting online social games and eSports while prohibiting online money gaming in the larger public interest.