Garena parent Sea Ltd shares tank as news of Free Fire’s ban in India emerges

India was the biggest market for the mobile battle royale game.

Image via Garena

Garena’s parent company Sea Limited shares have fallen substantially after reports emerged claiming its marquee mobile title Free Fire is getting banned in India.

India was one of the biggest markets for Free Fire. According to data provided by App Annie to TechCrunch, the country accounted for 40 million of its 75 million global monthly active users. Additionally, Free Fire was the top-grossing mobile game in India according to a report by MoneyControl. The game made $34.3 million in the South Asian country in 2021, which was a growth of 125 percent year-over-year.

In the early hours of Sunday morning (US time), however, Indian media reported the game was banned as it posed a “threat to national security.” These reports came after the game was pulled from the Google Play Store and Apple’s App Store in the country on Feb. 12, causing a lot of confusion in the Free Fire community.

Related: Vitality unveils India-based Free Fire roster hours before reports emerge country is banning game

Garena didn’t directly respond to the news of the game’s ban. Instead, in a statement sent to Dot Esports over email, the Singapore-based company said it’s “aware” the game is currently unavailable on the app stores and that it’s “working to address the situation.”

As news of Free Fire’s ban circulated, shares of Sea (SE:NYSE), which is publicly traded on the New York Stock Exchange (NYSE), took a big hit. At closing time on Friday evening, a single share of the company was valued at $158.25. On Monday morning, after Free Fire’s ban was reported, the shares opened at $139 before dropping further to $128.76, an 18.56 percent decrease over its Friday price.

The share price recovered slightly to close the day at $129.17. Sea also owns the e-commerce firm Shopee.

For Sea, the news of Free Fire’s ban couldn’t come at a worse time. The company was already having a hard time; its shares have fallen about 60 percent since Nov. 2020 for different reasons.

Free Fire wasn’t the only application that has reportedly been banned. Besides the game, 53 other “Chinese” applications are also being blocked in the country. The Indian government has yet to make a public statement on the ban.