An insight into SRK’s sports investment strategies

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Bollywoods’ King Khan is turning out to be the Badshah of sports enterprises. His latest cricket venture is the Cape Town Riders. The King’s Knights complete a hat-trick of global cricket leagues with a successful bid for the South African T-20 Global League. This is the third cricket league franchise for the Shah Rukh Khan and Jay Mehta-Juhi Chawla owned Red Chillies Entertainment.

The leagues mean serious business for the brand KKR, driven by SRK himself. The Knight Riders have been the only IPL team to post profits with consistency even as other franchisees continue to incur losses. The King’s Knights were the first IPL team to break even – right from the inception. For the majority of others the balance sheets are still in.

Before deliberating on KKR profitability, let’s know the business enterprise that runs the team. Kolkata Knight Riders Sports Private Limited is an unlisted company formed on February 27,2008, with a paid up and authorised capital of Rs 2000 lakh. On March 31, 2016 the company books showed a Revenue of Rs 125 crores, debt equity ratio of 0:17, Rs 6.2 crores profit after tax and a net worth of Rs 41 crores.

These figures emerge from the business model where a majority of competition is struggling to break even after 10 seasons of IPL. Shah Rukh Khan’s charisma never lets his team see losses. Not even in the first years. His being there brings the value for money for team’s associates. He does not possess a degree in business administrations, but knows and delivers without failure, what it takes to run a business in profit. He is no motivational speaker. But practically competent to keep his team charged up to give their best. He is not a marketing head honcho, but his being their keeps KKR in news, on social media. He is not a sales professional, but his names ensures the best connect and value for money for KKR’s fans.

KKR

SRK is not a Hollywood star, but his Bollywood prowess makes him a global icon. That power, that charisma is worthy of transforming his global ventures into profitable ventures.

Name Shah Rukh is synonym with KKR. The team emblem or merchandising first invokes a thought about the Badshah of Bollywood much before it creates the images of cricket stars in purple flannels in one’s mind. That charisma sells. KKR has carried that charisma to the Caribbean Premier League, that charisma will also be visible in the SA Global T20. KKR’s logo is being coined as the themed identity for the franchisee business. Nothing but the city name will differ.

The Cape Town cricket administrators are excited with the news. “The record of KKR is superlative and anybody playing against them will have a daunting task. Just remember that they were the champions in the Indian Premier League in 2012 and 2014 and a semi-finalist in 2017,” said Nabeal Dien, chief executive officer of the Western Province Cricket Association (WPCA). This describes the power of being KKR, or the SRK’s business model for sports.

“I am extremely excited that the KKR team under the astute leadership of one of the world’s all-time greats who played his cricket under the shadows of the oaks, Jacques Kallis, will call Newlands home during the T20 Global League,” Dien has stated.

The local marquee players assigned to the eight franchise teams are Hashim Amla, Quinton de Kock, AB de Villiers, JP Duminy, Faf du Plessis, David Miller, Kagiso Rabada and Imran Tahir. The international marquee players are Dwayne Bravo (West Indies), Chris Gayle (West Indies), Lasith Malinga (Sri Lanka), Brendon McCullum (New Zealand), Eoin Morgan (England), Kevin Pietersen (England), Kieron Pollard (West Indies) and Jason Roy (England).

Red Chillies Entertainment earlier in 2015 had bought the Franchisee for the Port of Spain, Trinidad and Tobago, team in the Caribbean Premier League. The Trinidad and Tobago Red Steels after winning the tournament in the very first season of its acquisition by Red Chillies Entertainment were rechristened Trinbago Knight Riders.

Red Chillies Entertainment led by Shah Rukh and Mehta Group of business owner Jay Mehta and wife Juhi Chawla, did not just rechristened the CPL team, but also made it appear closer to their IPL venture Kolkata Knight Riders. The team adopted the KKR logo design. Its marquee foreign player is New Zealand’s Brendon McCullum, who has played for KKR in the past. Brad Hogg and Colin Munro have also played for KKR before. Darren Bravo and Sunil Narine currently play for both the Knight Riders teams.

The journey that has started as SRK’s first sporting venture, on a special considering for the iconic values he brought on to the table for IPL and BCCI, has in 10 years culminated into a profitable business reaching out to three global cities, across three continents.

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