CHENNAI: Over the last few weeks, two Indian Premier League (IPL) sides were sold for a combined ₹31,500 cr. While the sales of Royal Challengers Bengaluru (RCB) and Rajasthan Royals (RR) were in the post for a few months, the values raised eyebrows because of the compounding growth the teams fetched for its sellers.
One person who felt the valuation 'was on expected lines' was Satish Menon, Punjab Kings' chief executive officer. "There will always be interest in IPL irrespective of whether there is compounded growth in terms of broadcast (rights)," he told this daily. "The valuation was on expected lines."
A reason why the valuation raised eyebrows is that the broadcast rights are due for renewal after the 2027 season. While the stakeholders involved in the sales process pencilled in a broadcast revenue growth of over 40% — i.e compounding — there are some headwinds to keep in mind. One major advertising industry is now out of bounds (real money gaming) while two serious players merged into one (Star and Viacom).
It's why there's a lot of interest in the bidding process post next year. For the record, the first cycle was worth ₹8200cr. From 2018-22, it went for over ₹16000cr. The current cycle is worth just north of ₹48,000cr. If the values keep compounding in the same manner, the league could potentially be looking at a `100,000 cr valuation in the next five-year cycle. But there are of course those headwinds to keep in mind.
Some of the things baked into this valuation is the IPL's ability to be a cash generating machine and its potential to grow. For example, it's a given that at some point the league will become an home-and-away format league with a minimum of 18 league games before the qualifiers and eliminator (teams right now play 14 league games). There's also the prospect of a resuscitated Champions League T20. Menon said 'we would be happy to play more games'. "We would be happy to go by what the BCCI decides," he said.
The league has again shown a robustness in pivoting in terms of revenue. Post 2025's RMG ban, teams and the league were forced to look at alternative revenue streams but Menon said 'there was nothing to worry about'. "All of the sponsors have come at a substantially higher price," he said. "It's not that just because one sponsor moves out, the whole ecosystem comes to a halt. It's business as usual. Our sponsorship revenues have increased, the no. of sponsors have also increased. The growth is huge so there's nothing to worry about."
Because of his longevity, he has held the same designation since 2017, he has also had a ringside view of the league's evolution. "It's now matched with any of the international leagues happening all over the world," he said. "It's now evolved to that extent, the game itself has evolved and the interest has gone up."
Speaking of evolution, Punjab Kings themselves have evolved over the last 12 months thanks to the new regime of Shreyas Iyer as captain and Ricky Ponting as coach. "It's teamwork all the way," he said. "This is a well knit group working together. This is what is putting us right in the front."
After a good but slightly nervy start, they have the chance to go back-to-back at the MA Chidambaram Stadium on Friday. Irrespective of what happens in that game, they are an upwardly mobile unit.