Torrent Group’s acquisition of a majority stake in Gujarat Titans (GT) from CVC Capital for nearly $900 million has set a new benchmark for Indian Premier League (IPL) team valuations. This deal highlights the immense worth of the original eight IPL franchises, which, according to IPL executives and industry insiders, could command valuations ranging from $1.5 billion to $2 billion, depending on their financial performance and fan following.
Top franchises like Mumbai Indians, Chennai Super Kings, and Royal Challengers Bengaluru are expected to be valued at nearly double that of GT, while Kolkata Knight Riders, Rajasthan Royals, Punjab Kings, Sunrisers Hyderabad, and Delhi Capitals could see a valuation of around 1.5 times that of GT. “The original eight franchises are generating healthy cash flows each year. Hence, they will command a much higher valuation compared to GT, which is still in losses,” a top official with a leading IPL team told Economic Times.
One of the key drivers behind this surge in valuation is the IPL’s growing global brand presence. Franchise owners such as Reliance Industries, Sun TV Network, RPSG Group, JSW GMR Cricket, and Shah Rukh Khan’s Knight Riders have expanded their footprint by acquiring teams in cricket leagues across South Africa, the UAE, England, and the US.
“This diversification not only strengthens their brand but also provides them with the necessary scale to consider a stock market listing,” an industry executive noted. Some franchises may leverage this value by launching an initial public offering (IPO) or selling shares in the unlisted market.
Santosh N, managing partner at valuation service provider D and P Advisory, pointed out that GT’s high valuation indicates a broader trend in IPL franchise worth. “If the Gujarat Titans can command such a high price after just a few years, other franchises will likely follow suit in terms of attracting investors,” he noted. Similarly, Brand Finance India managing director Ajimon Francis emphasized that Torrent acquired GT at a premium, a trend that could extend to other teams. “Most of the big team brands are now global brands with a presence in multiple geographies and also in multiple business formats,” he said.
The IPL as a brand has also witnessed remarkable growth, with firms such as Houlihan Lokey, Brand Finance, and D and P Advisory valuing it between $10 billion and $16 billion in 2024. This surge has been fueled by the ₹48,390-crore media rights deal signed by the Board of Control for Cricket in India (BCCI) in 2022 with Disney Star India and Viacom18 (which have since merged), along with multi-year sponsorship deals worth ₹4,000 crore involving Tata Sons, My11Circle, Ceat, and AngelOne.
Financially, the IPL franchises have seen substantial revenue growth. The combined revenue of the ten franchises more than doubled to ₹6,797 crore in FY24, compared to ₹3,082 crore the previous year, according to data from Tofler. Despite rising valuations, Francis of Brand Finance believes that no franchise will sell a majority stake, with owners preferring to retain control. “Some minor offer for sale may happen in hush with new investors coming in to replace the earlier,” he observed.
The scarcity of IPL team ownership opportunities has also contributed to premium pricing. Santosh N highlighted the FOMO (fear of missing out) effect, which is driving valuations higher as investors and corporations compete for a limited number of assets. “IPL is a trophy asset and comes with ‘bragging rights,’ and you are ready to pay a premium for the same,” he said.
“Due to the limited assets available, the price at which they may get transacted might be significantly higher than their true intrinsic value.” A notable example is private equity firm RedBird Capital Partners, which is reportedly looking to sell its stake in Rajasthan Royals at a premium.
As the IPL’s financial and brand value continues to soar, its original franchises stand poised to command record valuations, attracting a new wave of investors while maintaining their elite status in the global sports market.
_______________________________________________________________________________________
Stay ahead of the latest cricket industry trends by subscribing to our free cricexec “daily briefing” newsletter.
