Dream11 will soon let you trade stocks in India
What's the story
Leading fantasy sports platform Dream11 is all set to make its foray into the stock broking and wealth management space in India. The company has applied for a license to operate as a discount brokerage firm under the name 'Dream Money.' The move will put it in direct competition with established players like Zerodha, Angel One, and Groww.
Strategic shift
Gaming bill's impact on Dream11
The decision to launch 'Dream Money' comes after the Indian government's Online Gaming Bill came into effect. The legislation imposed stringent restrictions on real-money and betting-style games, hitting Dream11's core business model hard. Backed by Tencent and Tiger Global, Dream11 had to suspend its real-money gaming operations earlier this year, leading to a staggering 95% drop in revenue.
Market opportunity
Tapping into retail investment market
The upcoming 'Dream Money' platform will leverage Dream11's massive user base of 260 million to tap into India's booming retail investment market. Industry executives believe that stock broking is a "natural adjacency" to the company's existing digital ecosystem. Despite the recent surge in retail participation in capital markets, only one in 12 Indians are registered investors on the National Stock Exchange (NSE).
Strategy
What Dream11 has to do next
After the gaming ban, Dream11 switched to a free-to-play, ad-supported model but is still looking for new revenue streams. The firm earned ₹6,384 crore in revenue and ₹188 crore in profit in FY23. To get a share broker's license, applicants must meet SEBI's "fit and proper" criteria, pass exams by the National Institute of Securities Markets (NISM), and get clearances from both the stock exchange and clearing corporation.