Valuation Questions Arise After Rs 31,000 Crore IPL Franchise Deals for RCB and RR
On March 24, two of the Indian Premier League’s (IPL) most high-profile franchises, Royal Challengers Bengaluru (RCB) and Rajasthan Royals (RR), officially changed ownership, triggering discussions over unprecedented valuations in the league’s history. Both teams, part of the IPL since its inception in 2008, were acquired in deals totaling more than Rs 31,000 crore.
A consortium led by the Aditya Birla Group (ABG) emerged as the lead bidder for RCB, purchasing the franchise for USD 1.78 billion (approximately Rs 16,700 crore). Rajasthan Royals, meanwhile, was acquired by a US-based consortium led by Kal Somani for USD 1.63 billion (around Rs 15,290 crore).
The staggering figures underscore the IPL’s growth as a global sports phenomenon. Over the past 18 years, the league has become the richest cricket tournament in the world, attracting massive investment, sponsorship, and viewership comparable to top international sporting events. Yet, the astronomical valuations of RCB and RR have left some experts questioning the financial rationale behind the deals.
Expert Voices Concerns Over Valuation
Santosh N, managing partner at D&P Advisory, told The Indian Express that the valuations of the two teams were “difficult to understand,” especially in comparison to recent franchise deals such as the Gujarat Titans’ acquisition by the Torrent Group for under a billion dollars.
He explained: “So in a year, it is almost like a double valuation. And what has happened in that one year is actually only negative for the IPL the real-money gaming ban, broadcasting rights renewal has not happened, no new title sponsorship deals… and in spite of that, we have seen this double valuation. That is something that is very, very difficult to understand.”
Focusing on revenue, Santosh noted: “Rs 500 crore comes from central pool revenue, which is the broadcast money. Each team has anywhere around Rs 200–300 crore from sponsorship, ticketing, and merchandise revenue. So we are talking about Rs 700–800 crore in total revenue, which is less than 100 million dollars yet these teams are being valued at around 1.7 billion dollars, almost 20 times revenue.”
Details of the RCB Acquisition
Regarding RCB, now officially the most expensive IPL franchise, a source close to the development told PTI: “The consortium has reached an agreement with United Spirits Limited (USL) to buy 100 percent stake in RCB. The deal includes both the men’s and women’s teams of the franchise.”
USL, a subsidiary of UK-based Diageo, had reportedly been looking to divest from RCB, as the franchise did not align centrally with its core business operations.
Following the acquisition, Aryaman Vikram Birla, director at ABG, is set to serve as RCB’s chairman, with Satyan Gajwani of the Times of India Group as deputy chairman.
Pending Approvals
While the deals have been signed, formalities remain before the transactions are fully completed. Approvals from the BCCI, the IPL Governing Council, the WPL Governing Council, and the Competition Commission of India are still pending.
As the dust settles, the RCB and RR acquisitions underscore both the soaring financial value of the IPL and the questions around franchise valuations that investors, analysts, and fans will continue to debate in the months ahead.
