Online Gaming In India To See 657M Gamers By FY25

cioreviewindia Team | Thursday, 29 July 2021, 04:33 IST

Online Gaming In India To See 657M Gamers By FY25Since 2016, whenever one feels that online gaming has touched its tipping point, one is proven wrong. Online gaming was pushed to grow by 4G in 2016 and the pace of the growth further was accelerated during the COVID-19 pandemic. As a result of this, online gaming has recently emerged as a mainstream entertainment option in India. The growth of online gaming in 2020 was in fact, the fastest-growing segment in the media and entertainment sector of India. Even though online gaming is relatively new, it competes with traditional modes of entertainment like radio, television and cinema for the share of time spent in the Media and Entertainment sector.

Gamechilling has created serious opportunities for online gaming

Since the onset of the COVID-19 pandemic, the term game chilling has become extremely prevalent. More and more citizens have been investing their time in online gaming and this, in turn, has resulted in its serious growth and has made this industry an extremely serious opportunity. The increased popularity of the gaming industry has also gained the interest of both investors and corporations.

Overview of the online gaming industry

Recreation options were extremely limited in lockdown with zero options of outdoor recreational activity. India is a country with a young population and the young demographic of the country are mostly tech-savvy who are familiar with 4G technology, digital payment structure and of course, online gaming. The young population of India has expanded the online gaming industry from 250 million gamers in March 2018 to 433 million gamers in June 2020. With the current growth rate, it is projected that by FY25, India will house 657 million gamers.

During the pre-COVID era, the average weekly time spent on smartphone games was 2.5 hours and it made up 11 per cent of the total screen time. However, this time duration in playing mobile games increased to 4.1 hours during COVID-19 time and also, it contributed to 15% of the screen time. It was also noted that because the entire globe was going through an economic slowdown, many people also started investing in lotteries like the Bhutan Lottery to earn some extra money. In India, Teer Result needs to be checked after participating in a lottery to check its result.  A KPMG report stated that different metrics to see the growth in mobile games like in-app purchases, downloads and conversion was higher than the pre-COVID-19 time.

Valuation of online gaming

In FY21, the valuation of the domestic online gaming sector in India was 136 billion INR. It is projected that by FY25, with a CAGR of 21%, the valuation of the online gaming sector will be around 290 billion INR. Investors and corporates are trying to swim with the flow and grab the opportunity that the online gaming sector is offering.

 

A capital inflow of $544 million was seen in the gaming sector between August 2020 and January 2021. Investment in the same sector was a mere $350 in six years, between 2014 and 2020. Many micro VCs are also emerging with VC giants to offer their capital for unlocking creativity, innovation and talent. The funding by such investors has helped tremendously many small and local gaming companies of India to increase their scalability. Also, the huge popularity of the gaming sector has resulted in an improvement in operating margins.

Casual gaming is particular high in popularity

Out of all the different gaming categories, casual gaming is the most popular type of game. In 2020, India ranked second for the highest number of downloads of casual gaming after China. 17% of the entire mobile game downloads came directly from India. 420 million gamers of India, which is an extremely high number play casual mobile games. The segment of casual games alone is worth 60 billion in FY21. Out of all the gaming revenues, 44 percent of it comes from casual mobile games. It is believed that online casual gaming met its tipping point last year with both the engagement and consumption rate all-time high. However, there is still a lot of potential for growth in this segment with better monetization. In India, Ludo King became one of the most popular casual games. It also became a game that not only attracted the young population but also the older demographic population of 45 years and older.

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