After A Profitable FY21, IPO-Bound Adda52 Sees INR 4.4 Cr Loss In FY22

Adda52 parent Deltatech Gaming files DRHP for INR 550 Cr IPO

SUMMARY

The online poker platform incurred losses in FY22, after earning profits of INR 15.95 Cr in FY21 and INR 29.85 Cr in FY20

Adda52 registered INR 137.63 Cr in total income, down 11.80% YoY from the INR 156.05 it reported in FY21

Adda52’s parent company Deltatech Gaming has filed DRHP to raise INR 550 Cr via an IPO

Deltatech Gaming, the parent company of the online poker platform Adda52, saw losses for the first time in three fiscal years as it reported INR 4.4 Cr losses in FY22.

For both FY21 & FY20, Adda52 had reported profits of INR 15.95 Cr and INR 29.85 Cr respectively. It has seen two straight years of increasing expenses, while its income grew year-on-year (YoY) in FY21, before shrinking in FY22.

According to the consolidated financial statements, Adda52 made INR 137.23 Cr in revenue from operations in FY22, down 11.67% YoY from the INR 155.37 Cr it reported in FY21. Its other income stood at INR 41 Lakhs, down 41% YoY from the INR 69 Lakhs it had reported the fiscal year before.

In all, Adda52 registered INR 137.63 Cr in total income, down 11.80% YoY from the INR 156.05 it reported in FY21.

Deltatech Gaming filed a draft red herring prospectus (DRHP) with India’s securities and exchanges board (SEBI) to raise INR 550 Cr via an initial public offering (IPO) late last week. According to the draft prospectus, the IPO will consist of a fresh issue worth INR 300 Cr and an offer for sale of INR 250 Cr.

Deltatech Gaming saw its expenses rise, in tandem with its income falling. In FY22, Adda52’s expenses stood at INR 142.30 Cr, up 5.78% YoY from the INR 134.53 it had reported the fiscal year before. The gaming platform’s biggest expense was reported as ‘Other Expenses’, accounting for INR 100.64 Cr of INR 142.30 Cr in FY22.

Incidentally, the company saw its employee benefits expense rise by the most. In FY22, Adda52 reported INR 33.51 Cr in employee benefits, up 43.08% YoY from FY21, when it reported INR 23.42 Cr in employee benefits.

Deltatech Gaming offers several real-money games (RMGs), with Adda52 being the most successful. It said in the draft prospectus that Adda52 was one of the earliest companies in the RMG segment in India, and it claims to have a 34.5% market share in the segment.

According to a RedSeer report commissioned by Deltatech, India was the world’s second-largest gaming market in terms of user base in 2020, with around 400 Mn online gamers. India is expected to have as many as 710 Mn gamers in the next few years.

India’s total online gaming market was valued at INR 15,000 Cr in FY21, rising to INR 20,200 Cr in FY22. It is set to increase by a CAGR of 32% to reach as high as INR 63,000 Cr by FY26.