Breaking Down India’s ₹312 Billion Gaming Industry – Who’s Making the Money

Image credits: DallE

India’s gaming industry is now worth roughly ₹328 billion (~ $3.8 billion) and growing rapidly making it one of the fastest expanding digital sectors in the country. But who is capturing the biggest slice of this value? Let’s dig deeper to understand the money is flowing within the ecosystem.

Real Money Gaming: The 179-190 Billion Core:

As per the article published in Economic Times, Real Money Games (RMGs) sit at the heart of India’s gaming economy which involves fantasy sports, rummy, poker etc which alone account for about 85 to 86 % of the total industry income. That is nearly ₹276 billion of annual revenue. Platforms like Dream 11, Mobile Premier League (MPL), and WinZO dominate this space with large user bases and daily stakes leading activity. 

• Dream11 and My11Circle reportedly generated over ₹30,000 crore in combined revenue which highlights how significant fantasy sports are in India’s digital entertainment economy.

• WinZO, a leading omni-game platform, recorded ₹1,055 crore  demonstrating high margins in the RMG segment.

Even after the imposition of a 28% GST on total deposits in mid-2023, RMG remains dominant, although the tax restructure has slowed some growth in the segment.

Mid-Core and Casual Gaming: 

The remainder of India’s gaming revenue comes from casual and mid-core video games where titles like battle royales (BGMI, Free Fire), action/MOBA games, puzzle and simulation apps.

• Games like BGMI (Battlegrounds Mobile India), Free Fire Max and Call of Duty Mobile, along with India titles like Ludo King and Indus Battle Royale, drive monetization through in-app purchases, ads and subscriptions.

• India now being the world’s second largest market by mobile gaming downloads, the annual average revenue per paying user (ARPPU) increased by 15% in FY2024. With 25% of users making in-game payments, the number of paying gamers increased to 148 million. A high degree of overlap is found where about 60% of RMG paying gamers now pay for mid-core games as well.

Advertising and Monetization Mechanics:

Advertising remains a crucial revenue stream in non-paying segments where games rely on rewarded video ads, sponsorships and in-game branding.

• Ad revenue in gaming continues to grow at 20%+ annually, even when the global ad market softened, since brands strongly seek access to India’s expanding youth gamer base.

• Successful studios excel at combining ad monetization with small-ticket in-app purchases like ₹29 starter packs, to convert casual downloads into paying users, boosting retention and lifetime value.

Who’s Benefiting Most?

• RMG platforms like Dream11, MPL and WinZO are at the top of the value chain collecting the bulk of gross gaming revenues.

• Mid-core publishers (eg: Krafton’s BGMI, Garena Free Fire, Nazara’s Indus) thrive on in-app spending and season passes.

• Casual studios like 99Games with titles like Star Chef, profit through evergreen games with strong LiveOps and ad integration.

• Mobile first companies leveraging regional languages and volume in non-metro India have carved niches in non-primary metros and towns, feeding growth across segments.

Conclusion:

India’s ₹312 billion gaming economy is driven overwhelmingly by real-money gaming platforms, supported by a residue of mid-core and casual titles monetizing through ads and micro services. As regulations evolve and paying user conversion grow, the mid-core segment will capture more share but RMG remains to have the largest contribution to the Indian gaming revenue.