Online gaming companies have seen a 24% spurt in traffic, as working professionals and students turned to online games for entertainment and social connect amid the nationwide lockdown due to COVID-19, according to a recent report by Maple Capital Advisors.
The report ‘Gaming – India Story’ forecasts a compounded annual growth rate of 32% for the gaming industry in India to $3.7 billion by 2024 due to the growth of digital infrastructure and substantial rise in quality and engaging gaming content. Currently, the sector is valued at $930 million, up from $360 million in 2015.
“In India, with over 570 million people on the Internet, of whom over 85% are on mobile, gaming and streaming has been a popular form of engagement. In these lockdown times, we see this consumption has grown at least 20-30% despite significant impact on live sports, a big driver of fantasy sports gaming,” Pankaj Karna, founder and MD, Maple Capital Advisors, said.
As per the report, between the weeks of February 10 and 16, 2020 and March 16 and 22, 2020, visits to online gaming websites or apps increased by 24%, while engagement — as measured by time spent on gaming sites or apps — increased by 21% during the same time period.
Various gaming platforms in India include Games2Win, WinZO Games, Hitwicket, Gamerji and Rummy. The report added that fantasy sports gaming players such as Dream11 and MPL have seen a major hit due to postponement of IPL and other live sporting events.
Mr. Karna noted that the investments from venture capital firms in gaming in India was gaining traction, with over $350 million of investments between 2014 and 2020, growing at a CAGR of 22%.
“With growing internet penetration, compelling economics, usage statistics and increasing ecosystem of entrepreneurs and developers focusing on this space, we expect good growth in investments which are likely to at least double in this space in the next 1-2 years,” he said.
As per the report, there are about 400 gaming start-ups in India. Some of the big investments in the sector till now, as listed in the report, include $100 million investment in Dream11 by Tencent and Steadview Capital (2016), $75 investment in Ace2Three by Matrix and Clairvest (2018), $41 million investment in Mobile Premier League by Sequoia and Times Internet (2019), and $20 million in Paytm Games by One97 and AG Tech holdings (2020).
Mr Karna said that overall gaming was at an inflection stage in India, with rapid rise in consumption expected and investments likely to accelerate. “We have seen this play out in China and India too is likely to show similar trends,” he added.