India's Online Fantasy Sports Industry Forecasts a Grim Outlook Due to Taxation and Legal Uncertainty
New Delhi, November 14: India's online fantasy sports industry is expected to see a compounded annual growth rate (CAGR) of 7-9% from $1 billion to $1.6 billion by FY 2030, according to a new report jointly published by Google India and Deloitte.
The country's real-money gaming industry has witnessed significant layoffs, shutdowns, and a funding crunch since the central government announced a 28% Goods and Services Tax (GST) on player entry fees in July 2023. The tax imposed has significantly impacted the growth of the fantasy sports market, with the CAGR projected to decrease from an initial estimate of 30% by FY 2027.
According to the report, the industry's growth was expected to slow due to the new taxation and legal issues. Prashanth Rao, a partner at Deloitte, stated that the impact of the tax had put a "slight bit of recollection time" for the industry as it reorganizes itself.
The Think Sports report by Google India and Deloitte highlights that fantasy sports and e-sports are core sub-sectors driving India's sporting economy. The report projects that more Indian users will engage with online games on fantasy sports apps, with the number of fantasy sports players anticipated to reach 430 million users by the end of the decade.
The report also found that major fantasy sport platforms like Dream11 saw an 80% year-over-year growth in female users, reflecting a deepening fan engagement. Additionally, it was noted that video games and fantasy sports apps are fostering strong brand loyalty among users.
However, rising concerns over online gaming addiction among youngsters have not been addressed in the report. Earlier this year, reports emerged about attempts by the central government to implement "China-like" time limits and curbs to tackle the issue.
In conclusion, the Fantasy Sports industry's growth is seen to be significantly impacted due to taxation and legal uncertainty. However, with a projected market value of $130 billion by 2030, the sector remains a promising space for investments and new opportunities.