India’s Sports Technology Market: Growth, Challenges, and Future Outlook

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India’s sports technology market is at a significant turning point, driven primarily by the rapid increase in the Fantasy Sports (FS) industry. According to a recent report by Deloitte and the Federation of Indian Fantasy Sports (FIFS), the market generated revenues reflect  ₹26,700 crore in FY24 and is projected to grow at a CAGR of 13% to reach ₹49,500 crore by FY29. This article delves into the key aspects of this growing market, highlighting its sub-sectors, challenges, and future potential.

Overview of the Sports Technology Market

The Indian sports technology market is segmented into three key sub-sectors:

• Fan Engagement: Encompasses fantasy sports, ticketing, and sports gaming, providing fans with immersive experiences.
• Sports Data & Analytics: Involves the collection and analysis of performance data through wearables and data providers.
• Core Technologies: Includes cloud computing, 5G, IoT, social media platforms, and digital payment solutions.
• Tax changes and retrospective taxation notices led to a 90% decline in investments in the sector in 2023, with no new investments in 2024.
• National regulations, a stable tax regime, and industry-wide standards for responsible gaming are essential for sustained growth.
• Despite industry degrowth, the exchequer’s revenues have increased under the new tax regime.
• The industry’s GST contribution is projected to more than double from ₹1,480 crore in FY23 to ₹3,520 crore in FY24.
• The projected cumulative GST contribution from FY24 to FY29 is estimated at ₹30,380 crore.

Despite being in its nascent stage, the market has seen rapid growth, with cumulative investments of ₹27,500 crore between 2018 and 2023. Notably, 89% of Indian sports fans believe that emerging technologies have enhanced their viewing experiences.

Fantasy Sports: The Driving Force

The FS industry is the largest contributor to the sports technology market, with revenues of ₹9,100 crore in FY24. However, changes in GST regulations have impacted its growth trajectory. The industry is expected to experience a 10% decline in revenue in FY25, down to ₹8,190 crore, and a reduced CAGR of 7% from FY24 to FY29, compared to an earlier forecast of 30% from FY22 to FY27. Increased GST has halved the profit margins of FS companies, leading to a 90% drop in investments in 2023 and no new investments in 2024.

Challenges and Regulatory Landscape

The new tax regime has presented significant challenges for the FS industry, including retrospective taxation notices. Nonetheless, it has also increased the exchequer’s revenues, with GST contributions from the industry expected to double to ₹3,520 crore in FY24 and cumulatively reach ₹30,380 crore by FY29. Industry leaders emphasize the need for a stable tax regime, national regulations, and standards for responsible gaming to sustain growth.The integration of technology into sports is shaping India’s sports industry. Smt. Raksha Khadse, Ministry of Youth Affairs and Sports of India highlighted, “The way technology is being integrated through this partnership with Deloitte, along with other initiatives, is very promising for the future of sports in India. The role of sports technology will help us better analyse athletes and their development.”

Joy Bhattacharjya, Director General of FIFS, stated, “The sports technology industry in India is poised to unlock new levels of athletic excellence, fan engagement, and growth. Technology will improve athlete performance, enhance fan engagement, and enable talent identification.”

Prashanth Rao, Partner at Deloitte India, noted, “India’s sports technology market is projected to grow at 13% CAGR to ₹49,500 crore by FY29. Fantasy Sports is fostering deeper engagement and contributing to employment generation, with 17,500 new jobs expected by FY27.”

Rao emphasized, “A progressive regulatory framework, fostering innovation, and strengthening infrastructure will position India as a global sporting powerhouse.”

Future Outlook

The future of India’s sports technology market hinges on technological integration, regulatory support, and infrastructure development. Experts believe that sports technology will play a crucial role in enhancing athlete performance, engaging fans, and identifying talent. The Draft National Sports Policy 2024 aims to strengthen the sports ecosystem from grassroots to national levels, leveraging technology for economic development.

Conclusion

India’s sports technology market holds immense potential, driven by fan engagement and technological advancements. While regulatory challenges persist, a supportive framework could unlock significant growth, positioning India as a global sports powerhouse. As the industry evolves, continuous innovation and policy stability will be essential for its sustained success.

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