Shares of Nazara Technologies surged 16% to Rs 616 per share in intraday trade on Monday. The mobile gaming company reported that its consolidated net profit for the April-June quarter (Q1FY23) rose more than 22% year-on-year to Rs 16.5 crore. Meanwhile, revenue surged 70% year-on-year to Rs 223.1 crore from Rs 131.2 crore a year ago.

Despite today’s rebound, Nazara Technologies shares are still down more than 66% from their 52-week high of Rs 1,601 hit on October 11, 2021. The stock is down more than 48% so far this year. In contrast, the Nifty 50 and S&P BSE Sensex fell more than 2% over the same period.

The company’s Ebitda was flat year-on-year at Rs 30 crore. However, it rose to 102% sequentially from Rs 14 crore in Q4FY22. Meanwhile, Ebitda’s margin contracted from 22.9% in Q4FY22 to 13.5% in the current quarter.

In segments, esports contributed the most to total revenue in Q1FY23 at Rs 102.3 crore, up 92% year-on-year from Rs 53 crore in Q1FY21.

Gamification early learning and ad tech businesses were other major contributors to business revenue at Rs 52 crore and Rs 32 crore, respectively. However, expenses in Q1FY23 rose to Rs 207 crore from Rs 114 crore in the corresponding quarter of the previous fiscal due to higher advertising spending.

Moving forward, management remains confident in achieving the growth plan in FY23. During the quarter, the company acquired stakes in companies including Datawrkz Business Solutions, Paper Boat Apps, Nodwin Gaming and Absolute Sports. Previously, on May 13, 2022, the company’s board of directors approved a 1:1 issue of bonus shares to existing shareholders.

Analysts at JM Financial expect the company to post higher growth in FY23 due to acquisitions. However, they remain cautious about medium-term growth.