Indian Paisa League: Game on excels & books

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Yet another Indian Premier League season – 10th to be precise – got off with a dose of entertain. Forty overs of cricketing action overpowered the opening ceremony entertainment quotient that is ridiculed a damp squib in instant reactions by the tweeter world. Smaller boundaries, F-1 drivers-like sticker-laced coloured clothing, loud music, cheer leader squads. None to qualify as an ingredient of the gentlemen’s game. Then, this razzmatazz is never made for purists. The game made of bazaar is ruled by and played for the market forces.

If Lord’s governed the game of W.G. Graces, Sir Don Bradmans and Sunil Gavaskars of this world, this money-spinner is a brain child of business conglomerates and corporate forces. The outcome for the balance sheets is perceived on excel sheets. That’s the Indian Premier League for you. Executed on the oval but planned and governed from the board rooms. Board rooms of BCCI, franchisees, sponsors, and broadcasters alike. Players’ managers included. These board rooms witness more mind storming sessions than the dressing rooms.Score sheets are a by-product of balance sheets. Where each penny spent – other than on buying expensive tickets – is subjected to profit quotient.

The Board of Control for Cricket in India that is offering a rupees two crore annual retainer fee to top players, which still looks like peanuts to these players and their supporters, was struggling to manage even a meager rupee one lakh figure for each member of the 1983 World Cup champion team. Television then was an expense for the board to broadcast its matches. Today, it oozes the major share of cricket’s sky-rocketing revenues in India. Worldwide. Not just for cricket. For all sports.

Since inception in 2008, IPL has been a rage. Corporates, celebrities eye for IPL as an investment opportunity to earn profits. JSW – the steel conglomerate – has no qualms in confessing that the company is looking for an IPL investment. Purely for business. Pertinent to mention, the company has been the biggest CSR support for sports in India. For the company, sport was an integral aspect – but only for charity. Now, that’s the power of IPL.

Imagine, in a turf war between two Chinese hand set manufacturers to woo Indian customers Oppo has pledged Rs 1079.29 crore in an annual deal for Team India jersey branding. Vivo commits Rs 768 crore for the 47-day IPL. This is the brand value of IPL.

For broadcaster Sony Pictures Network the revenue from Rs 1,100 crore in 2016 has soared to Rs 1,300 for the current edition. If there were more slots available, Rs 1,400 crore was within reach, the broadcaster had claimed. The figures are set to ignite the values of media rights which come up for grabs as SPN’s 10-year deal with BCCI comes to an end with this season. The ten-year rights that were garnered by SPN for Rs 8,500 crore in 2008 are set to see up to 250% surge for the next 10-year cycle. The values are expected to touch from Rs 20,000 to 22,000 crore. The figures each franchisee is eagerly awaiting. For, this will tick the ‘red’ off their balance sheets.

These media rights are the biggest chunk of central revenue share the franchisee get from the BCCI. The other way the teams earn money is through sponsorships. Then, there is sale of tickets, income from trading players with other franchises, merchandise. And, then the Prize money purse. Huge. But not guaranteed as it only goes to the winner and the runner up.

A performance check by moneycontrol.com indicates that till date no franchisee has been able to harvest profits corresponding to their investment and efforts. There are losses, rather.

Consistent Kolkata Knight Riders
Topping the list will be Kolkata Knight Riders as they are the only team that has not only been consistent on field but also in profit making. Star power of Shah Rukh Khan has been a contributor to bring the team in the profit zone. According to data analytics firm Tofler, KKR reported profits of Rs 14.15 crore in 2016, up from Rs 9.19 crore in the previous year. Knight Riders Sports Pvt Ltd, which runs KKR, had clocked in revenues of Rs 168.71 crore in 2014-15, up from Rs 128.81 crore in the previous year.

Money-making Mumbai Indians
Mumbai Indians (MI) won two seasons out of 9, one in 2013 and the other in 2015. As price money received by a winning team is one of the biggest revenue sources, MI turned corner when its revenue slipped. The team earned Rs 220.87 crore in 2013-14, the year it won its first IPL. Next year, its revenues slipped to Rs 167.75 crore, but the firm managed to reduce its loss to Rs 3.87 crore.

Recurring losses for Royal Challengers Bangalore
Despite of having star players like Virat Kohli and AB de Villiers, Royal Challengers Bangalore (RCB) reported losses of Rs 30.06 crore in 2014-15, Rs 99.04 crore in 2013-14, and Rs 7.86 crore in 2012-13.

Deficit-ridden Delhi Daredevils
Delhi Daredevils, the team which is run by GMR Sports, saw profits in financial year 2013-14. However, the team was in red in 2014-15 when its revenue dipped to Rs 112.87 crore from Rs 151.22 crore in the previous year.

Pennywise Kings XI Punjab
Kings XI Punjab saw its profits shrinking and reported a loss of approximately Rs 9.4 crore in 2016. The company owned by Bollywood actor Preity Zinta along with Ness Wadia and Mohit Burman, reported net profit at Rs 12.7 crore in 2015.

Hardpressed Sun Risers Hyderabad
Joining the IPL brigade, Sun Risers Hyderabad (SRH) took the place of Deccan Chargers in 2013. But, it was a slow start for the team which reported loss of Rs 58.33 crore in FY2014-15. Exuding confidence in the team, SRH’s owner SL Narayanan is hopeful that the team will start “making significant free cash flows post FY 2018 when its commitment of annual licence fee of Rs 85 crore to the Indian cricket board BCCI ends.”

Earnings of the remaining two teams, Gujarat Lions and Rising Pune Supergiant, that are replacements of Chennai Super Kings and Rajasthan Royals are not yet available.

The money-spinning business is going to become more interesting from next season. With all new. All players going under the hammer. Sponsorship deals coming for fresh signings. More intrigue. More attraction. And in all likelihood – more (market) players and more moneys.

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