Esports, the competitive side of electronic gaming, boasts an estimated 250 million players worldwide in a growing market worth about a billion dollars a year.
The IOC in November recognised esports as a sports activity and it will be a medal event at the 2022 Asian Games.
Bach acknowledged the popularity of esports among young people but was wary of gaming's often-violent narrative.
"They show physical activity which can be compared to physical activity in some traditional sports," the German told reporters in New Delhi.
"In order to be recognised by the IOC and by the Olympic movement, it is not enough just to show physical activity there. The physical activity must also be in compliance with the values of the Olympic movement.
"We have to draw a very clear red line in this respect and that red line would be e-games which are killer games or where you have promotion of violence or any kind of discrimination as a content... they can never be recognised as part of the Olympic movement.
"They would be contrary to our values and our principles."
Bach is in India to meet the new set of Indian Olympic Association (IOA) officials and sports minister Rajyavardhan Singh Rathore.
Grappling with an ageing traditional audience and the waning appeal of several Olympic sports, the IOC is desperate to woo young people.
The introduction of sport climbing at the Tokyo 2020 Games is seen as another step in that direction and Bach said it was necessary to embrace new disciplines to stay relevant.
"Olympic Games have always been open to new sports without forgetting our roots. Tradition alone is no value. If you just stick to tradition and don't open up to sports practised by the younger generations, then you can lose your relevance very quickly.
"This us why we have to remain open to this and this is why we are happy that in Tokyo we'll see some of these sports on the Olympic programme."
"This is why we have added them, so that the Olympic Games in Tokyo will be younger, they will be more urban that means you'll see more sports organised in the centres of the city where people are.
"Sports will not retract to the stadia but will go to the people. There you will see more women participating than ever before in the Olympic Games."
(Reporting by Amlan Chakraborty in New Delhi; editing by Toby Davis)
