The Indian gaming industry is no longer just playing around. Riding a wave of increasing user engagement and clever monetisation strategies, local gaming companies are entering the big league, attracting global attention and even making strategic acquisitions to expand their reach.
For years, the Indian gaming market was primarily driven by the sheer volume of mobile game downloads. However, a significant shift is underway. As disposable incomes rise and digital payment infrastructure matures, Indian gamers are increasingly willing to spend money within games. This growing trend of in-app purchases (IAP) and the success of the “pay-to-play” (real money gaming) model, unique to India and built upon the Unified Payments Interface (UPI), are significantly boosting revenues for domestic companies.
Reports indicate that the Indian online gaming sector generated $3.7 – $3.8 billion in revenue in FY24, showcasing a robust year-on-year growth. Projections paint an even brighter future, with the market expected to reach $9.1 – $9.2 billion by 2029 and potentially hitting a staggering $60 billion by 2034. This explosive growth, driven by a massive user base of over 600 million gamers, positions India as a key player in the global gaming arena.
The rising financial strength of Indian gaming companies is fueling global ambitions. We are witnessing a trend of strategic acquisitions and increased foreign investment, signaling a growing confidence in the quality and potential of Indian gaming IPs and talent.
A notable example is South Korean gaming giant Krafton, the developer of the popular Battlegrounds Mobile India (BGMI). Demonstrating its commitment to the Indian gaming ecosystem, Krafton recently acquired a controlling stake in Indian gaming studio Nautilus Mobile, the creator of the highly successful “Real Cricket” franchise, for $14 million. This acquisition provides Krafton with access to a well-established and popular sports gaming IP, further solidifying its presence in the cricket-loving nation and potentially expanding its global reach.
Furthermore, Indian gaming companies like Nazara Technologies, the only publicly listed gaming firm in India, have been actively pursuing acquisitions to expand their footprint in various gaming and entertainment segments, including esports and even comic conventions. This proactive approach to mergers and acquisitions highlights the industry’s drive for consolidation and expansion.
While real money gaming currently dominates the Indian gaming revenue landscape, accounting for a significant portion of the market, non-real money gaming segments like mid-core games are also experiencing rapid growth. This diversification of revenue streams indicates a maturing market with a broader appeal to different types of gamers.
Despite the impressive growth and global interest, the Indian gaming industry faces certain challenges. High Goods and Services Tax (GST) rates on real money gaming and the presence of illegal offshore gaming entities continue to be concerns for domestic companies. However, with a massive and young population, increasing smartphone penetration, affordable internet access, and a growing pool of skilled game developers, the long-term outlook for the Indian gaming industry remains incredibly promising. As the industry matures and homegrown IPs gain global recognition, Indian gaming companies are well-positioned to become major players in the international gaming market.
Key Highlights:
- The Indian gaming market is experiencing significant growth, projected to reach over $9 billion by 2029.
- Rising in-app purchases and the popularity of real money gaming are key drivers of increased monetisation.
- Indian gaming companies are gaining global attention, with examples like Krafton’s acquisition of Nautilus Mobile.
- Non-real money gaming segments are also showing strong growth, diversifying the market.
- Despite challenges like high taxes and illegal operators, the future of the Indian gaming industry looks bright due to its large user base and growing talent pool.