{"id":172772,"date":"2024-11-11T22:12:04","date_gmt":"2024-11-11T22:12:04","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/11\/11\/despite-gst-hike-e-gaming-companies-revenue-up-12-in-fy24-times-of-india\/"},"modified":"2024-11-11T22:12:04","modified_gmt":"2024-11-11T22:12:04","slug":"despite-gst-hike-e-gaming-companies-revenue-up-12-in-fy24-times-of-india","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/11\/11\/despite-gst-hike-e-gaming-companies-revenue-up-12-in-fy24-times-of-india\/","title":{"rendered":"Despite GST hike, e-gaming companies revenue up 12% in FY24 – Times of India"},"content":{"rendered":"
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NEW DELHI: Contrary to the concerns raised by online gaming companies when GST rates were raised by govt, the industry\u2019s revenue grew by 12% to $3.8 billion in FY24, even surpassing what was earned by social media companies.
According to a report released by gaming VC Lumikai, the growing trend of in-app purchasing (IAP) by players, as well as a packed sports schedule that boosted fantasy gaming, led to the industry registering growth despite initial fears from companies that numbers would decline with the decision to impose a 28% GST on the full-face value of player deposits.
\u201cIn-app purchase revenue continues to be the fastest-growing segment with 41% year-on-year growth. With sustained growth in in-app purchases and ad revenue, the gaming market is expected to cross $9.2 billion by FY29, growing at a 20% five-year CAGR,\u201d Salone Sehgal, founding general partner at Lumikai, told TOI.<\/p>\n

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Sehgal said that online gaming continues to witness growing adoption by users, and even the time spent has increased. \u201cThe average weekly time spent on games increased by 30% in FY24, going up to 13 hours against 10 hours previously. The market saw the onboarding of 23 million new gamers as the total user base swelled to 590 million.\u201d Cheap data rates and growth in affordable smartphones \u2014 the main medium for players to access gaming \u2014 have fuelled the industry\u2019s growth not only in metros and bigger cities but also in Tier 2 and Tier 3 towns and rural areas.
At 15.2 billion, India is the world\u2019s second-largest market for mobile gaming downloads, 3.5 times larger than the US and Brazil, Lumikai said. Over 60% of the smartphone user base of 883 million had games downloaded on their devices, and of this, 148 million are paying users, as per the FY24 report.
The changes in tax rates saw the margins of companies come under pressure as real-money gaming (RMG) companies absorbed the GST cost of users, Sehgal said. \u201cDespite growth in topline revenue, taxation challenges in RMG resulted in margin compression and an adverse impact on profitability.\u201d Giving insights into the user base, the Lumikai report said 44% of gamers are women, many of them playing casual games. \u201cAs many as 66% of gamers come from non-metro cities.\u201d The report said that gamers on average spend 13 hours per week, more than double what is spent on social platforms. \u201cAround half of the gaming users are ad-tolerant,\u201d Lumikai said.<\/div>\n