Zupee, the Gurugram-based real-money gaming startup, has reached a major milestone by reporting a profit after tax (PAT) of Rs 146 crore in FY24, marking its first-ever profitable fiscal year since its inception in 2018. This turnaround comes on the back of rapid growth in its user base, product development initiatives, and strong operational execution.

A Strong Financial Leap

In FY23, Zupee posted a loss of Rs 36 crore. However, in FY24, it not only reversed that loss but also clocked a 36.5% rise in revenue, reaching Rs 1,123 crore, compared to Rs 823 crore the previous year. This performance is particularly noteworthy, considering the implementation of a 28% GST on real money gaming, which began in October 2023.

Despite this increased tax burden, Zupee’s strategic focus on adaptability, operational agility, and product innovation helped it sustain momentum and close the year on a high.

Game Portfolio and Revenue Model

Founded by Dilsher Singh Malhi and Siddhant Saurabh, Zupee operates in the rapidly growing skill-based gaming segment. The platform is best known for its real-money gaming version of Ludo, but it also features other popular games like Snakes and Ladders and Trump Cards.

Zupee allows users to play both free-to-play and cash games, where players can win actual money. The company earns revenue primarily through platform fees charged for accessing these real-money games.

Expanding User Base and Workforce

As of FY24, Zupee boasts over 130 million registered users, a 60% increase year-over-year. This significant jump is attributed to its expansion beyond North India to newer markets across the country.

To support this growth, Zupee increased its workforce by over 10% in FY24, especially in critical areas like product development, data science, technology, and operations.

Statement from the Founder

Reflecting on the company's journey, Founder and CEO Dilsher Singh Malhi called FY24 a "landmark year." He said:

“We didn’t just grow; we built an entirely new category in India’s gaming landscape. Our growth proves that games rooted in Indian culture transcend geographies and generations.”

He emphasized that the team didn’t only scale but did so profitably and with cultural relevance, establishing Zupee as a leader in the real-money gaming space.

GST Impact and Future Outlook

While Zupee reported strong results despite the 28% GST introduced in October 2023, the full-year impact of this revised tax regime will be visible in FY25. The company’s early adaptability to regulatory changes has been critical in mitigating immediate impact.

Zupee’s emphasis on responsible growth and its product-first strategy have laid the foundation for sustained performance. However, FY25 could test this resilience further as the tax implications become fully realised.

Investor Backing and Valuation

Zupee was last valued at $600 million during its $102 million funding round in January 2022. To date, it has raised over $121 million, backed by investors including WestCap Group, Tomales Bay Capital, Nepean Capital, AJ Capital, Matrix Partners India, and Orios Venture Partners.

This backing and financial stability put the company in a strong position for future growth, especially as the Indian gaming market continues to expand.

Industry Context: Gaming Sector in India

According to a recent report by Lumikai, a gaming and interactive media venture fund, India’s gaming industry reached $3.8 billion in revenue in FY24, up from $3.1 billion in FY23 — a 22.6% YoY growth. The real-money gaming segment accounted for $2.4 billion of this revenue.

The report also predicts that the gaming industry will grow to $9.2 billion by FY29, with a 20% compound annual growth rate (CAGR) over the next five years.

Competitor Snapshot

Zupee isn’t alone in benefiting from the gaming boom:

• Head Digital Works, which owns A23 Rummy and A23 Poker, reported a 31% rise in revenue to Rs 1,378 crore in FY24, with a PAT of Rs 72 crore.

• M-League, the parent company of Mobile Premier League (MPL), saw a 22% increase in revenue but remained loss-making with a $44.9 million post-tax loss, though it did reach adjusted EBITDA break-even.

This highlights Zupee’s standout performance as one of the few companies in the segment to have achieved full profitability.

What Makes Zupee’s Growth Stand Out?

• Profitable operations in a high-burn sector

• Scalable product offerings rooted in Indian gaming culture

• User engagement via gamified skill-based formats

• Early compliance and adaptation to regulatory changes

• Sustained expansion into non-core markets

Conclusion: Zupee’s Role in India’s Gaming Evolution

Zupee’s FY24 performance stands as a testament to its strategic clarity, cultural product-market fit, and operational resilience. In a market where many players are still struggling to break even, Zupee has not only survived the GST storm but thrived — transforming into a profitable, growing, and culturally resonant gaming platform.

As the Indian gaming sector continues its upward trajectory, Zupee is well-positioned to shape the future of real-money gaming in India, with its focus on user trust, data-driven growth, and innovative gameplay rooted in tradition.

The Upcoming IPOs in this week and coming weeks are Tankup Engineers.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.