Adda52 company Gaussian Networks elevates Shivanandan Pare to CEO

Shivanandan Pare has been elevated to the chief executive Gaussian Networks, the company which operates online poker and rummy platforms Adda52 and Adda52Rummy. Pare was already the CEO of Adda52Rummy since July 2020. Pare has previously headed the new digital business at Aditya Birla Fashion and Retail Ltd. and has also served at chief operating officer of Bigadda at the Reliance Group.

Shivanandan Pare. Picture courtesy: LinkedIn

Gaussian Networks was acquired by Delta Corp in 2017 and is a subsidiary of the publicly-listed casino and hospitality company. The company’s acquisition was completed in 2017 for ₹223.9 crore; while the deal had been signed in 2016. Delta Corp operates the Deltin casinos in Goa, Daman. and Sikkim (as well as in Kathmandu) alongside running a hospitality business.

When the acquisition was closed, Adda52’s founder Anuj Gupta had plans for expansion, to enter livestreaming, and also start operating in offline activities. Adda52Rummy was launched in 2012 and the app has over 1 million registered users.

Delta Corp’s revenue and strategy for ‘online gaming’

While casinos and hospitality are Delta Corp’s core businesses, the company expanded into online gaming with Gaussian’s acquisition. In 2019, it also picked up a 19.5% stake in fantasy sports company HalaPlay, in which it co-invested along with gaming company Nazara Technologies.

According to Delta Corp’s annual report for 2019-20, the online skill gaming segment pulled in revenues of 162.14 crore in FY20, which was a growth of 9.44% over the previous year, making 16.7% of the company’s revenue. In the financial year, nearly 75% of the company’s revenue came from casinos.

According to Delta Corp’s earnings update for the quarter ended September 30, 2020, the company has two full-owned subsidiaries: Gaussian Networks and Gaussian Online Skill Gaming Private Limited. In Q2FY21, Delta Corp made ₹44.59 crore from its ‘online skill gaming’ segment, registering a fall of 8.9% YoY.

During the coronavirus pandemic lockdown in March, the company’s entire business, except for operations of online poker and rummy, was suspended. In the quarter ended June 30, 2020, revenue ‘from online skill gaming’ segment totalled ₹57.01 crore. In Q2FY21, profit from the segment amounted to ₹1.27 crore, a drastic reduction from profits in the previous quarter (ended June 2020, Q1FY21) when it was nearly eleven times of this, and from Q2FY20 when it was nearly ten times.

Key notes from the company’s Annual General Meeting held in August 2020:

  • The company is looking at growing the online gaming business by 20-25% every year, and more games could be added in the future.
  • Traffic and time spent on the online platforms remain more or less the same in the Q2 over Q1 FY21
  • Advertising spend for online skill gaming (i.e. on ads, branding, and marketing) was ₹2.75 crore; a little over ₹2 crore was spent on poker and around ₹50-60 lakh on rummy
  • The company estimates that it has 50% of market share in online poker, in terms of players and revenue.
  • While the online gaming platforms saw significant jump in Q1 in user numbers, it’s possible that numbers could taper as the economy opens up. However, habits changed during the period are likely to stick with the customer, according to Delta Corp chairman Jaydev Mody.

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