India's Sports-Tech Boom — Rs 49.5K Crore Market By 2029, Fantasy Sports Hit By GST Roadblock: FIFS-Deloitte Report
Despite its pivotal role in the sports-tech sector, the fantasy sports industry is witnessing slowed growth due to recent tax law changes.
India’s sports technology industry is set for significant expansion, with revenue projected to climb from Rs 26,700 crore in FY24 to Rs 49,500 crore by FY29, reflecting a compound annual growth rate (CAGR) of 13 per cent, according to a report by the Federation of Indian Fantasy Sports (FIFS) in collaboration with Deloitte. Titled 'Beyond the Field: India’s Sports Tech Revolution', the report highlights the rapid evolution of the sports-tech ecosystem, spanning fan engagement, sports data and analytics, and foundational technologies.
Key Drivers Of Growth
The report categorises the industry into three primary segments:
- Fan Engagement: Encompassing fantasy sports, sports ticketing, gaming, and immersive experiences that strengthen audience participation.
- Sports Data & Analytics: Focused on leveraging historical data to enhance athlete performance and business strategies through wearables and data-driven insights.
- Foundational Technologies: Involving the use of cloud computing, 5G, IoT, social media platforms, and digital payment solutions to support the industry’s infrastructure.
Fantasy Sports Market Slows Due To GST Regulations
Despite its pivotal role in the sports-tech sector, the fantasy sports industry is witnessing slowed growth due to recent tax law changes. Previously experiencing rapid expansion, the industry posted revenues of Rs 9,100 crore in FY24 but is now bracing for a 10 per cent decline in FY25. The growth outlook for fantasy sports has been adjusted to a 7 per cent CAGR between FY24 and FY29 — considerably lower than the earlier forecasted 30 per cent CAGR for FY22 to FY27.
A key factor in this deceleration is the impact of increased Goods and Services Tax (GST), which has significantly affected company profit margins. The sector has absorbed an estimated 50 per cent hit on earnings due to the new tax structure. Additionally, retrospective taxation concerns have deterred investors, resulting in a 90 per cent drop in funding during 2023, with no new investments recorded in 2024.
Industry Leaders Call For Policy Reforms
Commenting on the report’s findings, Joy Bhattacharjya, Director General of FIFS, emphasised the transformative potential of sports technology. “The sports technology industry in India is poised to unlock new levels of athletic excellence, fan engagement, and overall growth in the sports industry. It can be a critical lever in elevating the sports experience for both the fans and athletes,” he stated. He also stressed the need for policies that encourage technological advancements and innovation in sports.
Prashanth Rao, Partner at Deloitte India, noted the industry's inflection point, highlighting the role of digital advancements in creating engaging fan experiences. “Fantasy Sports continues to be a key driver in this evolution, fostering deeper engagement and community-building while also contributing significantly to employment generation and economic impact, with the industry expected to post a CAGR of 7 per cent until FY29 and create 17,500 direct and indirect new jobs by FY27,” he said.
Government’s Role In Shaping The Future
The Government has reaffirmed its commitment to bolstering the sports ecosystem through the Draft National Sports Policy 2024, which aims to enhance sports culture and infrastructure. As the sports-tech industry expands, a progressive regulatory framework will be crucial to sustaining its momentum. Industry experts advocate for a balanced tax regime and policy stability to encourage innovation and investment in this rapidly growing sector.
With increasing technology adoption in fan engagement, gaming, and data analytics, sports technology is poised to play a crucial role in shaping India’s sporting landscape, bridging the gap between fans, athletes, and businesses while fostering long-term economic impact.
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