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November 2021
Solve. New

Leveling Up
INDIA’S
GAMING
MARKET
2021
Inside Digital Entertainment’s
Fastest Growing Sector

Knowledge Technology
Partner Partner

© 2021 RedSeer Consulting confidential and proprietary information

 Foreword
As India’s first and most active gaming and interactive fund, our mission for this report is to shine a light on the
true potential of India’s gaming market. We’re proud to present the most comprehensive deep dive of India’s
gaming market ever undertaken. This inaugural report leverages insights from India’s gaming ecosystem
leaders, knowledge partners, and proprietary Lumikai insights gleaned from conversations with 500+ founders
from India’s gaming sector.

India’s gaming market is due to surpass $2.2B in value in 2021, growing 3x to over $7B in 2026. The
market is also maturing faster than expected across all key markers — in user sophistication, propensity to pay,
quality of talent, capital inflows, and exits. This represents enormous upside for founders and investors in this
Justin Keeling space over the coming decade.
General Partner, Lumikai.
Monetisation has always been the billion-dollar question for India’s mass scale audience. We map out
remarkable inflection points for the fastest growing gaming market in the world. India for two years running has
seen the highest proportion of first-time paying gamers (over 50% YoY) out of any country in the world. At a scale
of ~10B gaming apps due to be downloaded in 2021, this represents a once in a generation growth opportunity
across India’s entire gaming value chain.

We also include never-been-seen-before insights from the largest panel of Indian gamers ever surveyed. Over
2,000 domestic mobile gamers were interviewed across 30 categories on their habits, preferred features,
motivations, and propensity to spend — split across multiple demographic and socio-economic profiles.

We’re thankful to all our partners and LPs who continue to support us on this journey, and we look forward to
sharing future insights as the market continues to grow and matures.
Salone Sehgal
General Partner, Lumikai. Team Lumikai, October 2021

©RedSeer 2
 Preface
The Indian gaming market is coming of age. Restrictions imposed in COVID lockdowns led users to explore alternate forms of entertainment. This,
in turn, was provided by mobile and digital games. The growth and user-base of games surpassed that of popular OTT & Video-on-Demand
services by as high as 4-times, during the period.

India's demographic dividend, with its large young population and increasing income, shows a strong potential for gaming, a market growing
exponentially as the mobile internet penetration sky-rocketed in 2020. The lockdown encouraged new users to pay for games, which saw an
unprecedented growth in “First-time payers”. Several other factors have further driven the growth of the sector; and resulted in a large gamer base
of 400-450 Mn, which is expected to reach to 700 Mn by the end of 2025.

New formats such as HyperCasual, Social games and eSports are expected to outperform the market growth rate in the next 5 years. As gamers
mature, the monetization streams are also expected to evolve with the proportion of In-App Purchases and Ad revenue increasing to the overall
revenues of Gaming companies.

We at RedSeer, with Lumikai - India’s first and most active gaming and interactive fund, have also been able to dissect the complex gaming sector
in various categories; and analyze the consumer behavior by surveying over 2000 gamers in India. Amongst other findings, we gathered that while
the average monthly spend on games is around $1.5, it is as high as $3.5 for Real-Money games.

We hope that the report will help the reader gain a perspective of the sector, and help developers and publishers in their game development
and management.

Anil Kumar
Founder & CEO
RedSeer

©RedSeer 3
 Executive
Summary

©RedSeer 4
 India’s gaming market is at a once in a generation inflection point exceeding previous estimates
on sophistication, scale, growth, and propensity to pay (1/2)

Executive Summary Gaming market in India: Trend by Segment

$~0.8 Bn $~1.8 Bn $~2.2 Bn $~7 Bn
FY19-FY26P. USD Bn

CAGR ‘21-’26

25-30
27% Casual & Hyper- 30-35%
Casual

The gaming market in India is a $2.2 Bn industry, 25-30%

1 India’s Gaming and is projected to grow at ~30% CAGR to reach
24%
19% Mid & Hardcore

Market Size: $2.2 $7B market -- more than 3X in the next 5 years.
25%
19%

Bn growing to $7B
22%

RMG 25-30%
India is transitioning from a net importer of 8% 50%

in five years
52%

global gaming titles to a global exporter of 12% 49%

content and IP. 40%

3% 1% PC & Console ~10%
3%
7% 2% 3% Esports
0% 1% 40-45%

FY19 FY20 FY21 FY26P

An estimated 96 Mn Indian users are forecast to pay

for games in 2021. Paid gamers are forecast to reach 20% of roughly 400 Mn active gamers in India
2 Propensity to Pay ~240 Mn (3x) in the next 5 years. choose to pay for games

Growing: Average India’s percentage of first new time paying users

Overall RMG Non-RMG
yearly spends at (NPUs) in gaming is the fastest growing in the world
two years running, at 40% (2020) reaching 50% Spend/ month ₹~100 ₹~250 ₹~50
$16 per gamer in 2021.
Average gamers spend ₹1,200 ($~16) per year on
Survey results show that up to 50% of new midcore games, with RMG users spending INR 3,000 ($~40)
and hardcore game users pay $7-$14 per month. per year. (Survey results across a sample of 2180).
Av spend per paying user is $77/year.

©RedSeer Note (s): For this report, we have included all games played or viewed on mobile, PC, Consoles and any other digital medium. 5
 India’s gaming market is at a once in a generation inflection point exceeding previous estimates
on sophistication, scale, growth, and propensity to pay (2/2)

Executive Summary
Gaming market in India: Trend by Revenue Streams
$~0.8 Bn $~1.8 Bn $~2.2 Bn $~7 Bn

CAGR ‘21-’26
In-app purchases now constitute 27% of RMG

Revenue growth
25-30% (53%)

3
~3.7

domestic gaming spending, with IAP growth

~30%
forecast to outstrip RMG and ad monetisation
increasingly being through 2025 and beyond. In App

driven by new
~2.1
(31%)
Purchases
~1.2 (IAP)
(54%)
With RMG remaining in a regulatory grey zone,
forms of ~40%
~0.9

developers are implementing newer, fast ~0.6 (11%) ~0.7

Ad Revenue
monetisation
~0.5 (26%)
(27%)

growing forms of monetisation such as (17%)

~0.3 (15%) ~0.3
~0.3 Others
subscriptions and virtual tipping/gifting. ~0.1 ~0.1
~20%

FY19 FY20 FY21 FY26P

Indian Gamers’ Behaviour

The market is
4 maturing both from
Users are maturing and localising in their
behaviour – from time-spent gaming,
Time Spent Gaming : Average weekly time spent on gaming
engagement with new midcore gaming
has risen to ~3.6 Hours from ~2.5Hr before Covid lockdowns.

formats, and over 60% expressing interest Esports, Streaming & Social gaming are rapidly growing in
a demand (user) and in more Indian themed games. India; especially in regional & vernacular markets.
supply (developer) The number of gaming companies has India Themed Games : Players surveyed indicated a strong
perspective seen a geometric increase, from 25 studios preference towards games with Indian central themes or
in 2015 to over 500 in 2021. characters.

©RedSeer Note (s): For this report, we have included all games played or viewed on mobile, PC, Consoles and any other digital medium. 6
 CONTENTS 1. Gaming in India: Context & Introduction
2. Dynamics and Opportunity
3. Market, Business Model and Segments Deep-dive
4. Technology Disrupting Gaming
5. Investment trends enabling growth in Gaming
6. Appendix

©RedSeer 7
 India Gaming market is witnessing an unprecedented growth phase
fueled by various social, economical and technological factors

Macro perspective and impact on India Gaming

Descriptive

India is emerging as one of the world’s largest gaming markets, especially post the COVID 2020/21 lockdowns;
with multiple macro drivers, domestic market is expected to grow to $~7 Bn by FY2026.

Young Digital India and Increasing Social &

Population Internet Access Disposable Income interactive Culture

~500 Mn individuals in the World’s cheapest data rates Income increased ~45% Sophisticated gamers with
age group of 15-35 years at just $0.1/GB in last 5 years exposure to Western games

Large ‘target segment’ and Lower barriers to Increased ability to Strong culture of games and
potential user base access games spend when motivated social motivations for users

$~7 Bn Gaming Market by 2026

Note (s): For this report, we have included all games played or viewed on mobile, PC, Consoles and any other digital medium.
©RedSeer Source(s): RedSeer Analysis, Secondary Research. 8
 Gaming is increasingly becoming the more popular medium of recreation in India;
with the growth in time spent four times higher than time spent on OTT Video during lockdown

Media Consumption in India Change in Time Spent Gaming

Avg. Time spent per users per week (Hours) Past Behaviour v/s Future Expectation

Pre-Covid Lockdown Week 1 Lockdown Week 2

+44% +12%

30% 19%
Decreased

69% Remained
62%
the same

3.3
3.6

3.9
3.1

3.5
2.5

8% 11% Increase

Gaming OTT Video Past 12 Months Next 12 Months

Gaming on smartphones has grown in popularity especially during the COVID lockdowns. The time spent on gaming has increased ~45%, which is higher than other forms of
entertainment consumption such as video-streaming services
Approximately 30% of users also claim that their usage of mobile games has increased during the past 12 months and for ~20%, it is likely to increase going forward as well.

Note (s): Pre-Covid : 13Jan-2Feb ’20 ; Lockdown Week 1 – 21-27 Mar ’20 ; Lockdown Week2 – 28Mar-1Apr ‘20.
©RedSeer Source(s): RedSeer Analysis, Survey Results, Nielsen SmartPhone Panel, BARC report. 9
 The Indian Gaming Market has accelerated post-Jio, with Covid lockdowns boosting
experimentation and social gaming; along with a rise on spending through RMG

Indian Gaming Sector Timeline

2005-2010 2011-2015 2016-2018 2019-2020 2021 and Beyond Major Milestones

Emergence of Experimentation phase Monetization Phase Adoption & Crystallization Phase Launch of Jio
Digital Gaming A Led to growth in game
A Growth of Free-to-play Games downloads and online
Improved gaming. Also thrusted India
hardware allowed Early adoption of
evolution of downloading games B Emergence of Real money games from an experimentation
complex games on phones; especially phase to a monetization of
like Bounce & with popularity of games phase.
Android; started.
Prince of Persia on
mobile etc.
C Growth of Social/Multiplayer games
Emergence of RMG
PC & Console games B Real Money Games (RMG)
Pre-installed like Age of Empires, Adoption of Esports & Game streaming portals
Access to affordable like Rummy, Fantasy Sports
games like Snake and FIFA were popular. data encouraged
gamers to explore, and Poker became popular;
were popular on
mobile phones.
download and play proving the viability of
more games on their COVID-19 lockdowns &
mobile phones. social distancing encouraged
monetization models.
PC & console the growth of users exploring
games were social & multiplayer games
including RMG
considered
Growth of Social Gaming
aspirational. C COVID-led lockdowns
encouraged a growth in
Age of Empire, FIFA, Social/community gaming
Counter Strike, etc.

Angry Birds, Temple Run,

Candy Crush
(Online) Rummy, 3 Patti, Ludo King, MPL
Snake(mobile), Mario, Dave,
Brian Lara Cricket

Note (s): The trend in India gaming reflects the inflection points in customer behaviors
©RedSeer Source(s): RedSeer Analysis, Secondary Research 10
 India’s gaming market is segmented into three major categories:
Mobile games, PC & Console, and Esports & Streaming
Gaming Market Structure

India’s Gaming Market Structure

PC & Console Games Mobile-based Games Esports & Streaming

Hyper-casual Casual Mid Core Hard Core Real-Money (RMG) Competitive Gaming Spectatorship Game Streaming

Time to fun <20 Simple, easily Simple to start Complex, Games played Popular Tournaments Viewing game
secs, visually repeatable and with features multi-faceted, with real money multiplayer games run and attended streams on
simple, higher accessible for long tail games for based on skill or usually played or broadcast by channels like
churn. games. retention. enthusiast users. chance. professionally. media houses. Twitch & Loco.

Soap Cutting, Crowd City, LudoKing, CandyCrush, Battlegrounds Mobile India, Genshin Impact, DOTA,
Online Poker, Rummy, TeenPatti, & Fantasy sports. Tournament & competitions Twitch, Loco, Youtube
HelixJump etc. AngryBirds Free Fire, Mobile. League of Legends

Note(s): Game/Player examples are illustrative for respective categories; and follow no order or preference whatsoever.
©RedSeer Source(s): RedSeer Analysis. 11
 AGENDA 1. Gaming in India: An Introduction
2. Dynamics and Opportunity
3. Market, Business Model and Segments Deep-dive
4. Technology Disrupting Gaming
5. Investment enabling growth in Gaming
6. Appendix

©RedSeer 12
 With 400 Mn gamers in 2020, India’s gaming market is the world’s 2nd largest by volume;
and is expected to house ~700 Mn gamers in next 5 years

Gamers in India Structural Drivers

In Millions, 2018-2025P

A Growth of internet users

India has seen an exponential growth in the number of internet
users over the last few years

B Increase in smartphone penetration

Fueled by the availability of low-cost smartphones, the smartphone
+11% penetration also increased.

COVID Lockdown accelerated

C High data consumption
the organic growth of users Usage of data has risen recently driven by the reduction in data tariff
over the years.

D Technological innovations
+150 Several OEM & supply side advancements have boosted the usage
of smartphones, apps & games

E COVID-19 lockdown
Govt. imposed Covid lockdown accelerated the organic growth of
400

450

700
250

digital games by boosting downloads by 50%

F Emergence of vernacular internet & games

“Indian”-ization of games with introduction of vernacular language
options has expanded the user base
2018 2020 2021P^ 2025P^

Note (s): “Gamer” is someone who has played at least 1 digital game in the last 1 month. ^ P = Projected
©RedSeer Source(s): RedSeer IP & Analysis. 13
 A Over the past 5 years, the number of internet users in India accelerated significantly

Internet Subscribers in India Internet Users Mobile Internet Users

# of internet users (Mn); CY2005-25

Key Drivers of Adoption

100
~950
India’s internet users grew ~15%
during the past one year; with a ~750
strong growth from rural areas
80 ~680
560

60
COVID Lockdown-led boost
500
460
Jio - Affordable 4G LTE
368 882
40 323
Low cost 3G enabled smart phones 634 688
278
Internet enabled 2G phones 515
Desktop Internet 441 445
20
48 80 201

0 24

CY05 CY06 CY07 CY08 CY09 CY10 CY11 CY12 CY13 CY14 CY15 CY16 CY17 CY18 CY19 CY20 CY21 CY25
Mobile Internet Users (% internet user) 50% 82% 96% 89% 92% 94% 95% 98%

Note(s): Personal electronics are shared & also have dual sim- slots, which results in identical number of mobile & internet users.
©RedSeer Source(s): RedSeer Analysis, TRAI, Datareportal. 14
 B Moreover, the number of smartphone users in India has increased to over 500 Mn;
driven by strong demand from Tier-2+ cities and increasing affordability of high-quality smartphones

Smartphone Penetration in India

# of Smartphones, % of Population, CY16-25P
Highlights

Average selling price of

smartphones and increased ~ 38% India’s population owned a smartphone in 2020
adoption in rural and 880 Mn that can access mobile games from app stores.
vernacular users has boosted
the smartphone penetration OEMs are now targeting sub-USD100 users and the
600 Mn average cost of smartphones is reducing, which has led to
the increased penetration.
CAGR ~40% 500 Mn
Longer replacement cycles result in higher
480 Mn retained/ownership period of phone. Better quality,
affordable phones have increased the average period of
380 Mn ownership from 12-16 months to 16-20 months in India
between 2015 & 2020.
300 Mn

2016 2017 2019 2020 2021P 2025P

Note(s): P = Predicted
©RedSeer Source(s): RedSeer IP & Analysis, Secondary Research. 15
 C India has the world’s cheapest data tariffs resulting in increased data consumption
per unique connection; in-turn improving access to games and media

Average Data Consumption & Tariff USD/GB GB/month

USD per GB | GB/month; 2015-2025 P

Boost due to Internet Affordability Change in User Behaviour Rural Penetration

(Jio-launch) (Lockdown-led restrictions)
3.24 25

Rapid Growth in Active

consumption of internet,
$1.4 $8 $0.6 as seen by time spent

13.5
Cheapest Data 11.7
Tariff in the world
9.8
$1.08
7.6

4.1
1.1 0.1 0.1 0.1 0 0.1
0.4 0.2

2015 2016 2017 2018 2019 2020 2021 2025

Avg. Daily
Time spent on 3H 3H 3.5H 4H 5H 6H 7H 8-10H
Internet1

After the launch of Jio in 2016, India consistently had lowest data-tariffs in the world, enabling data consumption to become 4X within a year.
Currently, the data consumption is at 13.5 GB/month. As rural penetration grows, the average monthly data consumption is expected to almost double by 2025.

Note(s): 1. Time spent active consuming media, surfing or playing games (Active screen time)
©RedSeer Source(s): RedSeer Analysis, TRAI & DataReportal Secondary Reports 16
 C.1 In parallel, India has emerged as the fastest growing gaming market in the world
in terms of growth in new paying users (NPUs); now at over 50%

Digital Transactions in India

Number of transactions, In Bn.

Digital transactions in India have grown at a

+50% tremendous 50% CAGR in last 5 years (by volume of
transactions).

This enables and permits for strong monetisation

amongst Gamers on RMG, In-app Purchases etc. on
10

20

31

45

55
gaming platforms

FY2017 FY2018 FY2019 FY2020 FY2021

New Users & First Time Payers on Mobile Games

Multiple platforms observed strong organic growth of
users; especially during the lockdown months of
2020.
+50%
First Time Paid User The past year also saw a jump in monetization
+40% during FY2021 conversions, as New Paying Users in gaming grew
(YoY Growth)

First Time Paid User from ~40% in FY20 to ~50% FY21.

in FY2020
(YoY Growth)

©RedSeer Source(s): RedSeer Analysis, Secondary Research 17

 D Technological innovations from the supply-side are supporting continuous and
healthy growth for the budding gaming sector.
Smartphone split by Price Buckets (INR)

Tech innovations driving growth % of smartphones, CY20

Low cost smartphones with

high specs
Higher RAM & better processing power in phones allowing better graphics.

Better Storage capacity of mobiles have enabled users to store larger, complex
hardware games, encouraging developers to build games with better graphics.

62%

22%

10%
6%
Modern screen technologies allows a superior experience and longer
screen time even on phone.
<10k 10k-20k 20k-25k >25k

Companies like Asus, Xiaomi, Nubia have launched gaming-specific

OEM focus smartphones with high refresh rate screens, game modes, triggers, etc. to
on Gaming cater the growing demand of mobile gaming

Smartphone Game-focused accessories : A new accessory market is emerged with the

growing popularity of mobile gaming
Gaming-specific smartphones & accessories

Data cost per GB and Internet Speed in India

Mobile data prices in India have consistently been low; leading to better
Internet access, thereby more game downloads and playing ability.

Penetration With the introduction of 4G, mobile internet speed have increased from ~3

3.5

0.1
Mbps in 2015 to ~18 Mbps in 2021.

2015 2021
Internet Speed ~3 MBPS ~18 MBPS

©RedSeer Source(s): RedSeer Research & Analysis 18

 E The nationwide Covid lockdowns led to a jump in gamers;
and while all gaming segments benefitted, social games saw the strongest growth.
Despite COVID led surge in
Lockdown 1 Lockdown 2 downloads and market
corrections, monthly game
downloads have increased
200 by ~50% in the past 1 year

Game downloads in India 150

+51%
2020-21; Indexed to 100 Sudden jump in downloads;
with onset of lockdowns
100 Downloads plateau-ed
and returning to baseline
post the lockdowns
50

Jan ‘21

July ‘21
Feb ‘21
Dec ‘20

June ‘21
Mar ‘21

Apr ‘21
Oct ‘20
Sep ‘20

May ‘21
Jan ‘20

Apr ‘20
Feb ‘20

Nov ‘20
May ‘20

July ‘20

Aug ‘20
Mar ‘20

June ‘20
Segment Popularity1 Observations

5X increase registered in the In-app purchases (IAP). Inactive users returned to platforms organically
Casual Gaming Medium
Casual games with social gaming feature performed better than games that didn’t have the feature

Midcore and
Hardcore Low Specific games in Hard core & Midcore games grew significantly, but the sector was relatively lower compared to the other segments

The segment saw up 2X increase in userbase (a considerable increase in new users came in from Northern India)
Real Money Games High Increase in number of tournaments with a large growth from Tier 2+ cities
Daily revenue increased to over 1.8X at its peak.

India saw a spike in adoption and growth in the social games; especially during the COVID lockdowns
Social Gaming Very High
Friends and family took to social gaming to maintain social connections

Note(s): 1. Relative Popularity based on customer interaction & usage figures for the game segments
©RedSeer Source(s): RedSeer Analysis & Secondary Research 19
 F Further, introduction of vernacular languages and Indian themes on various apps and games
are expanding the addressable user base to non-English speaking clusters.

Drivers of Growth

Vernacular Current internet growth driven by new rural users in India at 13% (vs 4% urban growth) that prefer vernacular content
Monetizable vernacular user base is estimated at ~400 Mn (by 2023)
Offerings
Streaming of esports tournaments in Hindi is growing in popularity.
In 2020, PUBG tournament’s Hindi stream peaked at 449K viewers, highest in India (PMWL 2020)

7% 6%
8% 13% Highly Likely

How likely would you play ~ 60% of people would like

52% 57% 49% Likely
a game if the central theme or 45% to play a game with
character is from Indian themes / Indian themes.

mythology / celebrities? 20% 17%

18% 18% Indifferent
N = 2180
12% 11% Unlikely
10% 8%

8% 14% Highly Unlikely

10% 8%

Overall Metro Tier 1 Tier 2+

(N=834) (N=644) (N=702)

©RedSeer Source(s): RedSeer Research & Analysis 20

 F.1 Case-study: Emergence of Midcore, “India-first” culturally relevant games.

“India-first content” focused games

Emergence of
“India-first content”
As penetration for gaming is increasing beyond Metro cities and towards mid-to low-income individuals
focused games
i.e. “audience of the future”, preference for games with “India-first content” are increasing
due to “relevance and familiarity”

Multiple gaming studios have emerged and are building “India-first content” to tap the growing opportunity

A new generation of studios

are developing game
adaptation of popular Indian
Market Indicators

mythologies or popular 6% 6% 7%
domestic sports with midcore, 3% 3% 4%
social gameplay. These titles How likely would you play Will not play
are targeting increasingly 9% 10% 9%
a game if the central theme or Least likely
sophisticated Indian gamers
and are build to monetise character is from Indian themes / 17% 17% 18% Less likely
primarily via IAPs versus ads. mythology / celebrities? Indifferent
53 53 53
N = 2180 53% 54% 53% Likely
Very likely
Leading Studio

19% 8% 7%

Indian Themes Mythology Celebrities

©RedSeer Source(s): RedSeer Research & Analysis 21

 Driven by multiple structural drivers, we expect the gamer base to expand to ~700 Mn by 2025,
with a strong increase in paid gamers as a proportion of the total user base.

India Gamers Funnel

Millions of Users, CY20 – CY 25F
CY20 CY21 CY25

Access to Internet
Total population 675 100% 720 100% -~950 100%
with access to internet

Mobile Internet Users 635 94-95% 689 96% ~882 98%

Access to Mobile data packs

Smart Phone Users

Uses a Smartphone/Tablet
500 75-78% 600 87-90% ~860 95-97%

Gamers
Users who play atleast 400 80% ~450 70-75% ~700 75-80%
one game

Playing Gamers
Users who have paid for a ~80 20% ~96 21-23% ~234 30-33%
digital game or In-app
purchases
# of Gamers
CAGR 16%

Note(s): % refer to share of immediately higher level

©RedSeer Source(s): RedSeer Analysis 22
 AGENDA 1. Gaming in India: An Introduction
2. Dynamics and Opportunity
3. Market, Business Model and Segments Deep-dive
4. Technology Disrupting Gaming
5. Investment enabling growth in Gaming
6. Appendix

©RedSeer 23
 India’s gaming market is estimated at $2.2 Bn in FY2021 and is projected to become $7 Bn
in next 5 years, with in-app purchases (IAP) being the fastest growing segment

Gaming in India - by Revenue Streams

2019-2026P, USD Bn

$~0.8 Bn $~1.8 Bn $~2.2 Bn $~7 Bn Indian Gaming Ecosystem: Deep-Dive

CAGR ‘21-’26

Mobile Games
25-30% (53%) ~3.7 RMG A Most prevalent and rapidly rising mode of playing digital
~30%
games, especially for casual & real-money games.

PC & Console
(31%)
~2.1 In App
~40%
B Developing a niche amongst serious gamers for mid &
Purchases
~1.2 (IAP) hard-core games.
(54%)
~0.9

~0.6 (11%) ~0.7 Esports

(27%)
~0.5 (26%) Ad Revenue ~20% C Newest format of Digital gaming. Rapidly
~0.3
(17%)
~0.3 (15%)
gaining popularity, especially amongst young
~0.3 Others
~0.1 ~0.1 and serious gamers

FY19 FY20 FY21 FY26P

Pre-2019, the gaming sector was at an early stage & was dominated by international publishers and developers.
RMG will be expected to contribute a significant source of revenue with growing expectation of regulatory clarity.
IAPs are projected to grow ~40% by FY26 with the rise of paying users across casual and core genres
~$120 Mn revenue from ads is currently booked outside of India in addition to the ad revenue shown for 2021.

©RedSeer Source(s): RedSeer Analysis, Secondary research 24

 The market constitutes of 6 segments based on their key characteristics
– learning curve, session time and difficulty level.

Gaming Segments
Description and profile Characteristics

Description Learning curve Difficulty Level Session Time Example

Very-Short
Hyper-casual Simple mechanics which are very easy to pick up. Flat Negligible
(2 min)
Helix Jump, Ball Blast, Baseball Boy,
Driven by multiple, very-short session times. Car Merger, High Heels!

Simple game mechanics and rules, easily picked Hero Wars, Envoy-The King
Gentle Short
Casual up. Better graphics and gameplay than Negligible
(~5 min)
returns, Carrom Pool, 8 ball Pool,
hyper-casual games. Ludo King, Yalla Ludo,

Usually features a multi-player experience and Genshin Impact, Lord’s Mobile,

revolves around resource management skills. Medium to Medium Top War, Clash of Clans, Art of
Mid-core Gentle High (10-15 min)
Core Good graphics & details make it engaging. War, BGMI, Call Of Duty.

Games Complex gameplan, mechanics and storyline

Medium to Long Rise of Empires, FIFA Soccer,
Hard-core providing a very high engagement by gamers. Steep
High (>15 min) League of Legends
Usually played multiplayer.

Real Money Games related to poker, rummy, casino,

Low to Long RummyCircle,
cards, and any other which involves real Skill-based (>15 min)
Games (RMG) money when playing. Medium Dream11, Adda52.

Live streaming of gaming tournaments

Esports & & viewership. N/A N/A N/A
Loco, Twitch,
YouTube Gaming, Rooter etc.
Streaming

©RedSeer Source(s): RedSeer Analysis 25

 The market is dominated by RMG, with Esports, Casual and Hyper-casual
demonstrating the fastest growth

Gaming in India - by segments

FY19-FY26P, USD Bn.
$~0.8 Bn $~1.8 Bn $~2.2 Bn $~7 Bn

CAGR ‘21-’26

25-30%
Casual &
27%
Hyper-casual 30-35%

19%
Mid & Hardcore 25-30%
24%

25%
19% 25-30%
22% 50%
8% RMG
12% 52%
49%

72% ~10%
1%
3% 3% PC & Console
7% 1% 2% 3%
Esports 40-45%

FY19 FY20 FY21 FY26P

Real Money Games have historically been the largest revenue source for India’s gaming. This segment is expected to grow at 25-30% CAGR with growing
expectation of regulatory clarity.
Non-RMG gaming segments are expected to grow faster, driven by growth in In-app purchases, subscriptions and virtual gifting.
Esports & streaming is a nascent market but is witnessing strong adoption in the market. It is expected to grow at ~40% over the next 5 year period.

©RedSeer Source(s): RedSeer Survey & Analysis 26

 ~20% of gaming users in India are paid gamers, with RMG, Casual and Core games
the most popular amongst the paying user base

Do you pay for playing digital games?

N = 2180

What type of games do you pay for? What type of feature do you pay for?
% Respondents, N = 485 % Respondents, N = 485

22%
Yes
RMG 41% 72%
Real Money
Gaming
Casual 33%

Hardcore 22% 56%

Subscriptions

No 78% Midcore 14%

Hyper-casual 1% Virtual Gifting 17%

and Tipping
Social Games 1%
In-App
15%
Esports 1% Purchases

Google Pay and PhonePe are the most popular means of payment for games

©RedSeer Source(s): RedSeer Research & Analysis 27

 The average gamer spends an average of ₹107 ($1.5) per month on games; with the average RMG gamer
spending ₹250 ($3.5) per month. Our survey indicates that users are willing to pay as high
as ₹ 500 ($7) to ₹ 1000 ($14) per month on midcore and hardcore

How much money do you spend playing games in a month?

Monthly Average
INR 107 INR 10 INR 46 INR 54 INR 176 INR 249
Spend (N= 2180)
$1.5 $0.1 $0.6 $0.7 $2.4 $3.5

4% 7% 6% 1% 1%
< INR 50
6% 1% 9%
25% 5% 3%
INR 50
13%
17% 12%
INR 100-200 22% 20%
27%
18%

INR 200-500 26% 50% 26%

31%
0% 53
53 53
53% 53
53%
0%
39% 38%
INR 500-1000 30%
25%
INR 1000+ 7% 4% 8%
5% 0% 1%

Overall Hyper-Casual Casual Midcore Hardcore RMG

Notes: Monthly Average Spend is the average spend across the total gamer sample
©RedSeer Source(s): RedSeer Survey & Analysis 28
 Mobile PC & Console Esports & Streaming

A India’s mobile gamers are primarily young males; Casual & Hyper-casual formats
are witnessing growing adoption amongst women

Demographic Trends – Split by Gender

N varies by segment Split by Region
N=2,180 N=97 N=1,476 N=694 N=375 N=2,180 N=97 N=1,476 N=694 N=375

12%
22% 15%
37%
28% Female 38% 48% 40% 34%
Metro
53%

29% 33%
87%
Male 22% 30%
77% 84%
71% 22%
62% Tier 1
32% 28% 28% 32%
23%
Tier 2+

Overall Hyper- Casual Midcore RMG Overall Hyper- Casual Midcore RMG
casual casual

Split by Age Split by City Tier

N=2,180 N=97 N=1,476 N=694 N=375 N=2,180 N=97 N=1,476 N=694 N=375

1% 3% 1% 1% <18 22%
16% 23% 22% 21%
18-24 29%
North
32% 30% 30% 30%
28%
30% 16%
51%
44% 31% South
42% 42%
25-34
44% 42% 28%
24% 6% 26%
27% East

32% 35+ 26% 25%

24% 21% 26%
14%
21% 19% 23% West

Overall Hyper- Casual Midcore RMG Overall Hyper- Casual Midcore RMG
casual casual

©RedSeer Source(s): RedSeer Research & Analysis. 29

 Mobile PC & Console Esports & Streaming

A Across mobile gaming segments, India’s gamers are active users of social media, messaging
and online shopping – these channels are the primary sources for gamer acquisition.

Gamers overlap to other Digital Media Consumption

N varies by segment

Categories Hyper Casual Casual Midcore RMG

(In decreasing order of
(N=97) (N=1476) (N=694) (N=375)
overall usage)

Social Media 86% 1 74% 1 72% 1 56%

Messaging 82% 2 71% 2 71% 2 62% 1

Online 78% 3 67% 3 69% 3 59% 2

Shopping

Video 72% 63% 66% 60% 3

Banking and 70% 64% 65% 56%

Wallet

Audio 63% 53% 61% 49%

Shortform
41% 39% 48% 26%
content

News 39% 38% 48% 33%

©RedSeer Source(s): RedSeer Analysis, Primary research 30

 Mobile Hyper-Casual Casual Core RMG

A Hyper-casual games offer a quick and easy means to pass time and have become
a popular entry point for India’s first time mobile gamers.

Hyper-casual games are easy to learn, and encourage players to come back for multiple short-durations.
These games typically focus on a single task/activity, like running, parking a car or dunking a basketball etc.

Top Indian Hyper-casual Genres Characteristics of Hyper-casual gaming

Avg. Weekly Hours Spent Playing 1.8 Hrs

Users who increased gaming in last 12 months 20%

Arcade Puzzle Users who will increase gaming in next 12 months 14%

Top Hyper-casual Games Key Usage Characteristics

Typical # of Downloads for Top 100

~ 6 Mn Downloads

Typical # of MAU for Top 100

Helix Jump JoinClash 3d Rescue Cut Crossy Road Worms Zone.io
- Rope Puzzle
~ 28 Mn
Helix Jump SuperSonic Studios Hipster Whale Azur Interactive
MarkApp

Note(s): Player & game examples are for reference and not in any order or preference, Key Usage Characteristics refers to average metric figures for the Top 100 players in Q1-2021
©RedSeer Data on weekly hours spent playing, increased gameplay, and future outlook on gameplay based on survey data. Source(s): RedSeer Analysis, Primary & Secondary research. 31
 Mobile Hyper-Casual Casual Core RMG

A India’s Hyper-causal gamers play to relax and past time; they discover new games through
recommendations coming from friends and advertisements.

Source of discovery of hyper-casual games Motivation to play hyper-casual games

N = 97 N = 97

Friends/Family Relaxation and 95%

76% Destressing
recommendations

Time kill/
Playstore/Appstore
54% distraction
68%
recommendations

Self-expression/
creativity
45%
In App
advertisements
26%
Socialise with
other gamers/ like- 29%
minded people
Advertisement other
than apps
22%
Competition /
thrill-seekings 28%
Game reviews from
11% Personal growth
various media 19%

Influencers/ To make money

Celebrities 9% 11%

©RedSeer Source(s): RedSeer Analysis, Primary Survey & research. 32

 Mobile Hyper-Casual Casual Core RMG

A India’s casual gaming sector was previously dominated by globally successful titles,
although culturally resonant domestic games continue to grow.

Casual games typically have simple game mechanics and rules, and can be picked up quickly. Audiences for casual games
also spend less time playing than mid-core and hardcore audiences- playing more spontaneously or irregularly.

Top Indian Casual Genres Characteristics of casual gaming

Avg. Weekly Hours Spent Playing 3.3 Hrs

Users who increased gaming in last 12 months 28%

Action Arcade Adventure Card Puzzle Racing

Users who will increase gaming in next 12 months 16%

RPG Simulation Sports Trivia Word

Key Usage Characteristics

Top Casual Games
Typical # of Downloads for Top 100
~ 7 Mn Downloads

Typical # of MAU for Top 100

Candy Crush Ludo King Carrom Pool Temple Run Subway Surfer
~ 30 Mn
Activision Blizzard Gametion MiniClip Imangi Studios

Note(s): Player & game examples are for reference and not in any order or preference, Key Usage Characteristics refers to average metric figures for the Top 100 players in Q1-2021
©RedSeer Data on weekly hours spent playing, increased gameplay, and future outlook on gameplay based on survey data. Source(s): RedSeer Analysis, Primary & Secondary research. 33
 Mobile Hyper-Casual Casual Core RMG

A India’s casual gamers play to relax, but a large section seeks to socialize with other users
and enjoys the thrill these games provide.

Casual games typically have simple game mechanics and rules, and can be picked up quickly. Audiences for casual games
also spend less time playing than mid-core and hardcore audiences- playing more spontaneously or irregularly.

Source of discovery of hyper-casual games Motivation to play hyper-casual games

N = 97 N = 97

Friends/Family Relaxation and 93%

71% Destressing
recommendations

Time kill/
Playstore/Appstore
47% distraction
57%
recommendations

Self-expression/
creativity
42%
In App
advertisements
24%
Socialise with
other gamers/ like- 39%
minded people
Advertisement other
than apps
24%
Competition /
thrill-seekings
29%
Game reviews from
16% Personal growth
various media 18%
Higher % of gamers
Influencers/ as compared to hyper-
To make money
Celebrities 15% 16% casual games who seek
to socialise & compete

©RedSeer Source(s): RedSeer Analysis, Primary survey & research. 34

 Mobile Hyper-Casual Casual Mid-Core/Core RMG

A India’s midcore gaming sector is forecasted to see the biggest gains,

as hyper-casual and casual gamers graduate to more immersive social formats.

Mid-core games exhibit a significant considerable learning curve, game loops, and detailed graphics. They usually feature a multi-player experience
and resource management skills which means that session durations are longer and there are monetization opportunities via in-app purchases.

Top Indian Mid/Hard Core Genres Characteristics of Hyper-casual gaming

Avg. Weekly Hours Spent Playing 3.5 Hrs

Users who increased gaming in last 12 months 37%

Strategy Racing Action Role Playing Games
(RPG)
Users who will increase gaming in next 12 months 25%

Top Hyper-casual Games

Monthly Average Spends on Midcore ~$0.7

Monthly Average Spends on Hardcore ~$2.4

Genshin Impact Clash of Clans FreeFire Battlegrounds Lords Mobile

MiHoyo SuperCell Garena Mobile India IGG.COM
Krafton

Note(s): Player & game examples are for reference and not in any order or preference, Data on weekly hours spent playing, increased gameplay, average spends, and future outlook on gameplay based on survey data.
©RedSeer Source(s): RedSeer Analysis, Primary & Secondary research. 35
 Mobile Hyper-Casual Casual Mid-Core/Core RMG

A India’s midcore gamers prefer socializing with other people

and hence also rely on reviews for finding new games.

Source of discovery of hyper-casual games Motivation to play hyper-casual games

N = 97 N = 97

Friends/Family Relaxation and 91%

72% Destressing
recommendations

Time kill/
Playstore/Appstore
45% distraction
53%
recommendations

Self-expression/
creativity
44%
In App
advertisements
33%
Socialise with
Indicates a preference & other gamers/ like- 40%
need for research before minded people Gamers might indicate
Advertisement other
than apps
22% starting a new game an unmet need of “social
Competition / gaming” which is recently
thrill-seekings
37% growing

Game reviews from

22% Personal growth
various media 20%

Influencers/ To make money

Celebrities 19% 12%

©RedSeer Source(s): RedSeer Analysis, Primary survey & research. 36

 Mobile Hyper-Casual Casual Core RMG

A Real-money games are strong cash-driven recreational channels for grown-ups

Includes all skill-based games that involvement of real money such as fantasy, rummy, poker, and competitive gaming platforms.

Top Indian RMG Genres Characteristics of RMG

Avg. Weekly Hours Spent Playing 3.9 Hrs

Users who increased gaming in last 12 months 37%

Card Casino Fantasy Users who will increase gaming in next 12 months 27%

Top RMG Players

Key Usage Characteristics

Typical # of MAPU for Top 10 Apps

(monthly average paying users)

Dream11 Mobile Games 24x7 Winzo Adda52

Premier League ~ 300 - 500 K

Note(s): Player & game examples are for reference and not in any order or preference, Key Usage Characteristic refers to average metric figures for the Top 100 players in Q1-2021
Data on weekly hours spent playing, increased gameplay, and future outlook on gameplay based on survey data. MAPU: Monthly active paying users
©RedSeer Source(s): RedSeer Analysis, Primary & Secondary research. 37
 Mobile Hyper-Casual Casual Core RMG

A Indian RMG users are non-traditional gamers relying on friends and ads to choose their new games;
Making money is one of the key motivation to play

Source of discovery of RMG games Attraction to play RMG games

N = 375 N = 375

Friends/Family Relaxation and 86%

59% Destressing
recommendations

To make money
Playstore/Appstore
51% 70%
recommendations

Socialise with
other gamers/ like- 58%
Game reviews
from various media
42% minded people

Self-expression/
creativity 35%
Influencers/
Celebrities
37%
Time kill/
Distraction 26% Gamers seek to earn money
but refrain from competition
In-App as this is usually their
35% Personal growth
Advertisements 14% past-time activity

Advertisement Competition/
other than apps 22% Thrill seeking
10%

©RedSeer Source(s): RedSeer Analysis, Primary survey & research. 38

 Mobile PC & Console Esports & Streaming

Emerging themes across gaming in India - Social Gaming and Live Game Streaming

Social Gaming and Game Livestreaming

Games going “SOCIAL” “Livestreaming” Games

Social distancing in COVID lockdown led individuals and gamers to
remain confined to their households and need for social connection led
to rapid adoption of social games.
Adoption of games (e.g. Ludo, Teen Patti and Poker) with social feature
skyrocketed during COVID lockdown.
Livestreaming of games provide gamers a unique experience of watching
their favourite game played by experts.
There is an emerging segment of gamers that enjoy the "vicarious" offering
of live game streaming. Indian gamers increasingly consume live streaming
content offered by their favorite influencers instead of traditional media.

Social gaming features continue to be a key driver of retention and new Commentary by live streamers are another key driver for growth as
usage for domestic, regional language gamers, including female streamers provides reviews, commentary, humor, giveaways, and game tips.
audiences (e.g. Eloelo).
Key Games/
Platforms

©RedSeer Source(s): RedSeer Research & Analysis. 39

 Mobile PC & Console Esports & Streaming

B PC & Console based games serve a premium and growing set of users in India who value
high-quality gameplay, graphics and fidelity

PC & Console Games includes all video games played on computers (laptops, desktops etc.) and
dedicated gaming consoles (PlayStations, Xbox, Switch etc.)

Top PC & Console Genres Gaming Consoles in India (Market Share)

78.33 Playstation
82.76
74.25
58.52

Action Arcade Adventure Card Puzzle Racing 25.1

16.42 21.45
Xbox
10.65
Nintendo

Other

RPG Simulation Sports Trivia Word

FY19 FY19 FY19 FY19 FY19

Prominent PC &Consoles Prominent PC & Console Games

Consoles based gaming market in India is dominated by Sony and XBOX
accounting for 90-95% of the market.

Gaming consoles are still a small market and is mostly restricted to

Metros & Tier 1 cities.

The PC and console gaming market is projected to grow at 10% YoY

Note(s): Player & game examples are for reference and not in any order or preference
©RedSeer Source(s): RedSeer Analysis, Primary & Secondary research. 40
 Mobile PC & Console Esports & Streaming

C PC & Console based games serve a premium and growing set of users in India who value
high-quality gameplay, graphics and fidelity

Esports includes all viewing, streaming and professionally competing in popular games.

Prominent Esports Tournaments (India) Esports Prize Money

Prize Pool (USD) Announced & Predicted Prize Money from Esport Tournaments
USD Mn
ESL and Nodwin- One Mumbai 300k
Battlegrounds Mobile India Series 2021 134k

14.3
3.6
1.1
0.5
0.2
Free Fire India Championship 100k
ESL India Premiership 150k 4x growth
expected

Free Fire India Championship 103k

2021 Spring
DreamHack 2019 52k
Free Fire India Championship
2020 Fall 68k 2017 2018 2019 2020 2021

Prominent PC &Consoles Prominent Esports Teams/Players

Note(s): Player examples are for reference and not in any order or preference
©RedSeer Source(s): RedSeer Analysis, Primary & Secondary research 41
 Mobile PC & Console Esports & Streaming

C Live game streaming is rapidly growing as a source of mainstream entertainment for Indian users.

Game Streaming refers to the players recording or playing games live for others to view.

Prominent Streamers
Popular Platforms
Channel Streamer Subscriber Avg. Viewership Games Streamed

Total Ajay “Ajjubhai” 28.2 Mn 1.8 Mn Garena FreeFire,

Gaming Minecraft and GTA V

Techno GTA V, Minecraft,

Ujjwal C. 20.8 Mn 6.8 Mn
Gamerz PUBG Mobile, Garen.
Youtube Loco Rooter Twitch

A_S Gaming Sahil R. 14.2 Mn 2.4 Mn

Lokesh Gamer Lokesh Raj 12.7 Mn 1.1 Mn Garena Free Fire

Key Streamer Characteristics
Gyan Gaming Gyan Sujan 11.7 Mn 1.5 Mn

Desi Gamers Amit Sharma 11.4 Mn 1.3 Mn MineCraft, Garena.

Typical # of Subscribers for Top 10 ~ 10 Mn Dynamo Gaming Adil Sawant 9.9 Mn 8.5 Mn Dota 2, GTA V,
Apex Legends, PUBG & BGMI

Typical # of Viewership for Top 10 ~ 1 Mn Resident Evil Village,

CarryisLive CarryMinati 9.8 Mn 854 k
Cyberpunk, etc.

& others like Soul, Mortal, MythPat , Tanmay Bhat etc.

Note(s): Examples are for reference and not in any order or preference unless specified, Top streamer characteristics are based on metrics for Sept 2021
©RedSeer Source(s): RedSeer Analysis, Secondary research 42
 Mobile PC & Console Esports & Streaming

C Live game streamers operate like influencers on social media channels and their major revenue sources
are virtual tipping/ gifting, advertisements and sponsorships

Revenue Streams Description Mechanism Advantages Disadvantages

Virtual Tipping / Viewers can directly tip or Tips feature on the Brand recognition Tipping and gifting behaviour in
gift the streamer. channel / Direct sales. Direct sale & revenue the India market are still emerging
Gifting Id of fan base. forms of monetisation

Advertisement revenue is One-time payment only

Upfront and recurring monthly
Ad/Media a major source as these
payment dependent on
streamers are able to
Revenue generate large audiences
viewership and reach Heavily driven by viewership and
can favour select influencers
& traffic on their channels.

Partnership/ Sponsorship
Highly dependent on brand budgets, can
Popular streamers
Brand are sponsored to Can be both upfront payments be subject to macro-economic fluctuations
.
Sponsorships feature specific and long-term contracts.
Need strong relationships with brands, IP
games or products.
holders and media agencies

Sale of team or game Direct Sales Brand recognition

N/A
Merchandise merchandize to fans. Direct sale & revenue

Note(s): Share of revenue is indicative of a typical revenue split for a player at the sector-level
©RedSeer Source(s): RedSeer Analysis, Primary research. 43
 For non-RMG games, advertisements are a large source of revenue alongside in-app purchases. With an
increasing tendency to pay, in-app purchases are rapidly becoming a significant income source

Current Monetization Methods & Revenue Sources in Gaming.

Revenue Streams Hyper-casual and Casual Mid-core/ Core Real Money Games PC & Consoles Esports Live streaming

In-App Purchases ~5% 45-50% - 10-20% - -

Player/feature upgrades, Ad-free versions, extra ~5% 35-40% - 10-20% - -

lives & other Micro-transactions.

Season Passes & Downloadable Content. - - - - -

5-10%
"Loot boxes" and Special Gifts/Items boxes. - - - - -

Advertisement & Partnerships 90-95% 50-55% 5-20% - 70-80% 55-60%

Advertising/Media Revenue 90-95% 5-20% - 20% 45-50%

50-55%
Sponsorships - - - 50-55% 5-10%

Direct to Developer/
~1% - 80-95% 80-90% 10-25% 20-30%
Publisher Revenue Sources
Games Purchases Generally Nil Generally Nil Generally Nil 60-70% - -

Commission & Rake - - 60-65% - - -

Subscriptions - - - 20-30% - -
Tournament Entry Fees - - 20-30% - 10-25%

Virtual Tipping - - <1% - - 20-30%

Donations to Developer <1% - - - - -

- - - - 5-10% 5-10%

Merchandise - - - - 5-10% 5-10%

- - - - <1% <1%

Note(s): Share of revenue is indicative of a typical revenue split for a player at the sector-level
©RedSeer Source(s): RedSeer Analysis, Primary research. 44
 AGENDA 1. Gaming in India: An Introduction
2. Dynamics and Opportunity
3. Market, Business Model and Segments Deep-dive
4. Technology Disrupting Gaming
5. Investment enabling growth in Gaming
6. Appendix

©RedSeer 45
 Technological innovations are democratising the game development and enhanced gameplay experience;
AI-ML solutions are easing issues faced by Game developers to ensure better performance of games,
improved user targeting and fraud detection
Artificial Intelligence (AI) & Machine Learning (ML) in Game Management.

Game Management Functions and Tasks Use of AI/ML Application of AI & ML

Building more engaging and detailed games by

Use of generative AI to build content
Game Personalization Analyze user likings and personalize games
User Monetization - Using AI models to increase retention
Non Technical
Content Generative Tools Increase LTV & improve monetization etc.
Aspects
Fraud & Anomaly Detection
Fraud & anomaly detection is a strong use-case with use of
Graph databases; which can help identify fake users,
account sharing and other such digressions.

Deploying the game servers

Infrastructure
Management
Managing various components
and the back-end of the game.
on virtual machines.
Containerized game servers
on “Kubernetes”
Usually inbuilt in the game’s back-end, but new options of
Choosing a completely managed services rely on AI and offer hosting on Cloud
managed service for hosting AI & cloud service enable smoother server management &
load distribution for higher efficiency and stability of games.

Session Management Game backend In-built

& Matchmaking Or managed suites
Ensuring a smooth experience for (continuous integration and
continuous deployment )
players during a game/play

Note(s): Non-exhaustive feature. AI/ML usage is continuously evolving to utilize the large amount of user data generated.
©RedSeer Source(s): RedSeer Analysis, Primary research. 46
 AGENDA 1. Gaming in India: An Introduction
2. Dynamics and Opportunity
3. Market, Business Model and Segments Deep-dive
4. Technology Disrupting Gaming
5. Investment enabling growth in Gaming
6. Appendix

©RedSeer 47
 Gaming companies in India have seen a 500% increase in funding received during the last 4 years

Funding in Digital gaming in India

USD Mn
# of gaming
25-30 275 500+
companies

Passive Phase Sudden Surge

4.35

156

135

415

820
34
15
+426%

2015 2016 2017 2018 2019 2020 2021

The sector has attracted $800 Mn in investments in the last 6 months; with approximately $1.3 Bn raised over the last 18 months.
Number of India gaming companies has grown from 25 in 2015 to 500+ gaming companies in 2021; indicating strong potential in the sector.

Note(s): Investments till September 2021. Figures include only publicly disclosed funding.
©RedSeer Source(s): Crunchbase Data, Industry Reports, RedSeer Analysis. 48
 Private and public market funding led to emergence of large gaming players in India valued >$1Bn
Indian Gaming Unicorns

Public-led, Indian megahouse for games Rely on love for cricket & traditional MPL is driving the Esports segment in
with active M&A and diversification. sports via fantasy & RMG games. India with its platform-based offering.

Founded in 2000, a leading diversified Founded in 2018, its an online mobile gaming
gaming and sports media platform with Founded in 2008, India’s biggest and Esports platform offering 50+ titles. It has
offerings across casual gaming, Esports, multi-sport fantasy gaming platform been leading the Esports push in India while
RMG, and early-stage learning. with over 100 Mn + users playing. also providing casual, fantasy, & RMG.

Market Cap1 - ~ $ 1.2 Bn Valuation - $ 5 Bn Valuation - $ 2.3 Bn

Total Funding - $ 146 Mn Total Funding - $ 785 Mn Total Funding - $ 389 Mn
Key Investors - Westbridge, IIFL, ESL Key Investors - Falcon Edge, Tiger Key Investors - Sequoia Capital, Times
Gaming, Sequoia. Global, Tencent, Kalaari. Internet, MDI Ventures.

Note(s): Market Capital, Funding and valuation is taken as on October 13, 2021 after closing of markets; 1 INR = 70 USD,
©RedSeer Source(s): RedSeer Analysis. 49
 The market has seen the successful public listing of Nazara Technologies,
which was one of India’s first gaming companies.

Nazara Technologies IPO Snapshot

In USD Mn, FY 2016 - 20
IPO Insights

1.5x to 2.7x 174.46x ~ 80%

Being the first gaming company in India to
launch an IPO, Nazara Technologies saw huge
Gain Multiple for IPO Oversubscription Premium on issue price demand and captured a scarcity premium by
Exiting Investors 2nd Largest in 2021 on opening investors looking to participate in a fast
growing market.

With the IPO funds, Nazara aims to continue

Revenue Growth – Nazara Technologies
In USD Mn, FY 2016 - 20
Existing Investor Exit Multiples investing and acquiring companies with high
synergy with its existing portfolio. These
synergy acquisitions has made the stock more
Investor Gain Multiple valuable for the investors.

Westbridge Capital (Pre-IPO Exit) 45x

30

29

26

27

37

IIFL Fund 2x The IPO saw huge interest from foreign and
domestic investors alike, with major anchor
Good Game Investment 2.7x
investors being Goldman Sachs, Fidelity
Seedfund 2 International 1.5x Investments, Nomura, Kotak Securities, SBI
Porush Jain, Azimuth Inv, SeedFund2India 1.5x Mutual Funds, etc.
2016 2017 2018 2019 2020

©RedSeer Source(s): RedSeer Secondary Research, Primary Interviews 50

 AGENDA 1. Gaming in India: An Introduction
2. Dynamics and Opportunity
3. Market, Business Model and Segments Deep-dive
4. Technology Disrupting Gaming
5. Investment enabling growth in Gaming
6. Appendix

©RedSeer 51
 Glossary of terms used in the document (1/2)

Keywords Definition / Terms / Acronyms

Currency conversion 1 USD = INR 70

CY Calendar Year (January to December)

FY Financial Year (April to March)

Metro Cities Mumbai, Delhi, Bangalore, Chennai, Hyderabad, Kolkata, Pune, and Ahmedabad (8 cities)

Tier 1 cities Non-metro cities with population more than 1 Mn (20 cities)

Tier 2+ cities Non-metro cities with population less than 1 Mn (4400+ cities)

Rural Areas Population less than 10,000

Gaming Digital Gaming (including PC/Console and Mobile games)

Gamer A person who has the available resources (internet, mobile, PC/Laptop and/or Gaming console) and has independently played a digital game of any kind

Paying Gamers A Gamer who has explicitly paid for a game, game feature or any other direct form while playing (includes all In-app purchases & real-money gaming transactions

Hyper-casual games Single-core mechanic, easy to pick-up, difficult to master; and uniformly challenging games e.g.; FlappyBird

Casual games Games with engaging but simple mechanics and easy-to-learn rules. Enhanced graphics and gameplay over hyper-casual games; e.g.; Angry Birds, Candy Crush

Mid Core Games with detailed graphics and complex gameplay, often features a multi-player experience and revolves around resource management skills; e.g; Clash of Clans, Call_Of-Duty(Mobile)

Hard Core Intense & complex gameplays, detailed simulation, mechanics and storyline providing a very high engagement for gamers, e.g.; Microsoft Flight Simulator, Genshin Impact etc.

RMG Games related to casino, card or any involvement of real money or tokens against money like Dream11, Rummy Circle.

Esports Competitive digital gaming and live streaming of gaming tournaments & viewership.

Streaming Live or recorded uploading of a game play (on Youtube, Twitch etc.); may also be called “Live-stream”

Streamer Individual person who uploads and/or plays the Live- stream.

©RedSeer 52
 Glossary of terms used in the document (2/2)

Keywords Definition / Terms / Acronyms

OTT/ Video streaming Over-the-top media content and videos which can be view on demand; e.g.; Netflix.

Internet Subscribers A person who has access to any form from internet; broadband or wireless.

Mobile Internet User A person who has access and uses non-cabled internet through mobile networks like 3G,4G etc.

Digital Transaction Financial transactions done through various digital channels like GooglePay, PhonePe, etc.

In-app Purchases Refers to purchases made by a user while playing or using an app for additional access, feature or any such activity.

Ad revenue Income earned by displaying paid advertisements on their app/website surrounding their internet-based content.

MAU Monthly Active Users.

MAPU Monthly Active Paying Users.

ARPU Average Revenue Per User.

ARPPU Average Revenue Per Paying User.

LTV Lifetime Value : estimated total revenue that can be generated from a user during his/her lifespan as customer.

AI/ML Artificial Intelligence / Machine Learning technologies.

OEM Original Equipment Manufacturers.

Lockdown Unless otherwise specified; it refers to the period of complete restriction of businesses and movement imposed by the Indian government during March-May 2020 and
Apr-May 2021 due to COVID pandemic.

IP Intellectual Property.

OS Operating System.

©RedSeer 53
 About
RedSeer
RedSeer is a research and consulting firm founded in 2009. We are headquartered out of Bengaluru and have presence in
Delhi, Mumbai, Dubai, and Singapore additionally. Though we are focused on the consumer internet space in India, Southeast
Asia, and the Middle East, we have deep experience in overall retail as well. Our primary business activities include providing
research inputs (on market, consumers, other stakeholders) to corporations and funds, conducting due diligence for potential
investments, publishing thought leadership pieces, and helping corporate clients solve strategic problems.

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 Authors
Anil Kumar is the founder of Redseer Consulting. He has been part of engagements in Internet,
Private Equity, Retail CPG and Healthcare among others. He specializes in growth and
investment strategies. Anil is a believer of the data-driven approach in solving business
problems. His consulting approach leverages Data IP, sector expertise and the client’s core
hypotheses. He holds a B.Tech from IIT-Delhi.

Anil Kumar
Founder and CEO
He can be reached at anil@redseer.com

Mukesh Kumar is the engagement manager at RedSeer and has 7 years of experience in growth
strategy engagement across internet, gaming, education, healthcare, and consumer products
clients across India, MENA, and North America. He holds a B.Tech from IIT Delhi.

He can be reached at mukesh@redseer.com

Mukesh Kumar
Engagement Manager

Jaladhi Surati is a Senior Consultant at RedSeer; and has over 5 years of experience in strategy
& business consulting. He enables internet businesses in Gaming, eCommerce, FoodTech and
other Platform-businesses across India, South-East Asia and MENA regions. He holds a
Master’s degree in Business Administration from IIM Bangalore.

He can be reached at jaladhisurati@redseer.com

Jaladhi Surati
Senior Consultant

The authors would like to acknowledge the hardwork and support extended by Akshat Praneet, Muskaan Khetan and all others during the course of this report.

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 Disclaimer
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