Lumikai, an Indian gaming venture fund, has slashed the revenue forecast of the country’s gaming industry in its latest report on the sector. This comes at the back of the recently imposed 28 per cent GST on real money gaming in India.
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Dip in revenues
As per the report, the Indian gaming market is projected to hit the $7.5 billion revenue mark by FY28, a drop from $8.6 billion projected revenue for FY27 that were disclosed in a report unveiled in November 2022.
The Indian gaming industry clocked $3.1 billion revenue in FY23, registering a 19 per cent growth from $2.6 billion in FY22, as per the report that was released in collaboration with Google at the India Game Developers Conference in Hyderabad.
Consolidation of companies
Moreover, real-money gaming revenue grew by $500 million in FY23. But the report noted that the real money gaming companies in India are expected to face headwinds and industry consolidation in the coming years, due to the recently imposed 28 per cent GST.
Although real money gaming has been negatively impacted, Salone Sehgal, founding general partner at the fund, added that the rest of the Indian gaming industry might grow in the coming years.
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What about non-real money gaming?
“Indian gaming has been on the rise because of rapid digitisation, growth in new gamers and new paid gamers, and increasing diversity of gaming content consumed. Even though funding has slowed down this year, the outlook towards the gaming industry is extremely positive,” he said.
According to the report, the industry continues to show signs of rising maturity in the world’s second-largest internet market.
Growth in other segments
About 140 million gamers in FY23 were paying users, a 17 per cent year-on-year (YoY) increase from 120 million paying users in FY22. Overall, India had about 568 million gamers in FY23, up 12 per cent YoY from 507 million in FY22. This accounts for over 50 per cent of all Indian internet users.
The average time spent on gaming increased by 20 per cent YoY to 10-12 hours per gamer per week. India is one of the world’s biggest markets in terms of game downloads, clocking over 15.4 billion downloads in FY23.
The report also added that about 66 per cent of the gamers were from non-metro cities in FY23, as compared to 57 per cent in FY22, the report said. In terms of demographics, about 50 percent fall within the age bracket of 18-30 years, with a male-to-female ratio of roughly 60:40.
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“We’re particularly excited to see the increasing engagement of gamers from non-metro cities, which demonstrates the massive growth potential and the opportunity in the Indian gaming industry,” Sehgal said.
