Head Digital Works' PAT at Rs 72 cr: Gaming firm says expenditure high due to GST
Online skill gaming firm Head Digital Works, which operates platforms like A23 Rummy, registered a 24.1% rise in its profit after tax to Rs 72 crore in FY24 from Rs 58 crore in FY23.
Its consolidated gross revenue from operations grew by 31% to Rs 1,378 crore in FY24 from Rs 1,051 crore in FY23. Its gross total expenditure increased by 33% to Rs 1,298 crore in FY24 from Rs 975 crore in FY23. This includes the rewards and bonuses given to players after the higher Goods and Services Tax (GST) rate of 28% effective from October 1, 2023.
The company’s overall registered user base has gone up by 16.4% in FY24.
“Post implementation of the heightened GST regime for online gaming platforms, EBIDTA margins have narrowed significantly,” said the company in a statement.
In an interaction with BT, Deepak Gullapalli, CEO and Founder, Head Digital Works said the company’s expenditure has increased significantly due to the higher GST. “Instead of passing it on to the customer, the company has been absorbing the tax. That is a major expenditure,” he said.
