The trend signals a shift in perception that the Indian gaming space is all about real money gaming (RMG), which has been jolted by regulatory crackdown in recent years.
“Monetisation in non-real money games is still slow,” said Nitish Mittersain, founder and joint managing director of Nazara Technologies. “That said, every year we are seeing an increase in this propensity from users to pay.”
He expects India to become one of the largest monetising markets in the world over the next few years. “Even if the average revenue per user (ARPU) is low, the sheer volume of players is very high. I’m confident that we are on the right trajectory,” Mittersain said.
Specifically, revenue from midcore games—such as shooters, strategy games, and multiplayer action titles—is seeing renewed traction, particularly through in-app purchases, industry executives noted. This comes even as casual and hyper-casual games are being impacted by a global pullback in advertising spends.
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According to a recent report by gaming and interactive media venture capital firm Lumikai, over 60% of RMG-paying gamers now also spend on midcore games, indicating a significant overlap in gamer personas and growing player sophistication.
ETtechEarlier this month, ET reported that Mumbai-based Nazara has earmarked Rs 800–1,000 crore for inorganic growth this year. The focus areas include narrative and simulation games, casual and mid-core mobile games, sports media, gamified learning, and platforms built around user-generated content.
Mittersain noted that several global investors and companies view India as a massive gaming opportunity and are “sitting on the fence,” trying to figure out the best way to enter, participate, and monetise the country’s rapidly growing base of gamers.
Last December, Bitkraft Ventures, which backs gaming studios, platforms and gaming-related technologies, said it is doubling down on the Indian market. The company has appointed Anuj Tandon, former CEO of gaming at JetSynthesys, as its partner in India.
Last month, Krafton, an active investor in Indian gaming and tech startups, acquired a 75% stake in Pune-based Nautilus Mobile for Rs 118 crore. Nautilus, the studio behind the Real Cricket franchise, was previously owned by JetSynthesys. The acquisition marks Krafton’s first move to fully bring an Indian IP and development capability under its control.
On April 24, Blue Ocean Games, a venture fund backed by Krafton, launched a $30-million fund to support indie game developers globally, with a strong focus on emerging talent from India.
AI: boon or bane?
Industry executives say the rise of generative artificial intelligence is democratising game development, making it easier for new and smaller developers to build high-quality games.
“Emerging markets always have had the problem that we cannot make complex games. Now, AI has made game development slightly easier for new developers to pick up,” Bitkraft Ventures’ Tandon said. “For example, if I am sitting out of Surat and have a 20-member team, I might have the same advantage building an art-based game that a well-funded studio in the Middle East has. So, AI has in a way democratised game development and it is still happening, though not at full scale.”
However, experts also caution that while GenAI can significantly reduce development time, the resulting surge in content may outpace user demand. This could worsen monetisation challenges, as an overcrowded market struggles to find a sufficiently large player base.
“AI will lead to far more content than before. If, say, 1,000 games were being developed each year, with AI, that number could go up tenfold,” said Anurag Choudhary, founder of gaming startup Felicity Games. “But the number of users remains limited. So, I think the problem won’t be content creation, it will be the next step of user acquisition.”
VC challenges
Venture capital (VC) investments in the Indian gaming space have been on a downward trend in recent years as many mobile gaming companies operate with high customer acquisition costs and continue to struggle with consistent monetisation due to low ARPU.
Data from Venture Intelligence shows that VC funding in gaming startups fell sharply, from $661 million in 2022 to $130 million in 2023. In 2024, the figure rose to $195 million—largely driven by Tencent Holdings divesting its entire stake in Dream11’s parent company Sporta Technologies.
In the first four months of 2025, investments in gaming startups reached $24 million, the data showed.
“There are a lot of really talented artists and technical people in India, but there is a very limited amount of venture capital, so there is a lot of hunger for funding like ours from the developer side,” said Damian Lee, founder of Blue Ocean Games and former head of investments at Krafton.
Industry executives pointed out that other revenue-generating avenues—such as game publishing and streaming—are also gaining traction, as global mid- and hardcore games gain acceptance in India and Indian games start finding audiences abroad.
“India today is at a point uncannily similar to where China was in 2008. Around 400–500 entrepreneurs and studios are building games here,” said Tandon of Bitkraft Ventures. “Back then, China was just starting to adopt mobile payments; India is already ahead, and monetisation has started to kick in. In China, those who invested then saw 20 gaming IPOs in six to seven years. India is now a market you cannot ignore,” he said.
