IPL business value surges to $16.4 billion, says study

Indian Premier League’s (IPL) brand value has continued its robust growth with a latest study assessing it to have increased by 6.3% to $3.4 billion over last year. The business value of IPL – it is the assumed value a buyer would currently pay – has surged to $16.4 billion, up by 6.5%, according to the study conducted by American investment bank Houlihan Lokey.

IPL’s revenue model is heavily reliant on media rights proceeds. The big uptick in business value ($8.5bn to $15.4bn) came last year after Viacom 18 and Disney Star picked up the 2023-27 digital and TV rights for a collective $6.2bn. This year’s increase gets a boost from a positive revision in IPL title rights with Tata renewing its contract for ₹2500 crore for five years.

Delving on the brand value of IPL franchises, the study throws up expected findings. Riding high on the MS Dhoni fever that has been all-pervading in the past two seasons, Chennai Super Kings (CSK) continue to be No.1 on both brand value and business value indices.

Despite yet another season where they unsuccessfully chased a maiden IPL title, Royal Challengers Bengaluru (RCB) come No.2 on both the indices. The study highlights a fervent fan base, vibrant team identity and the Virat Kohli factor as reasons behind RCB’s emotional connect with fans and why it translates into sponsorship revenue and ticket sales. It helped that RCB had a remarkable run of come-from-behind wins this year to qualify for the playoffs and Kohli was again the top-scorer, winning the Orange Cap as this edition’s leading batter.

IPL 2024 winners Kolkata Knight Riders (KKR) are ranked third in brand value and fourth in business value. “KKR capitalizes greatly on the brand equity of its renowned owner Shah Rukh Khan and is regarded as one of the best-managed franchises for turning profitable before others,” the study says.

For five-time winners Mumbai Indians (MI), their long-term goodwill helped negotiate the negative impact caused by fan outrage over the captaincy change from Rohit Sharma to Hardik Pandya and the resultant last place finish. The study ranks MI at No.3 and No.4 in business value and brand value respectively.

Rajasthan Royals’ (RR) improving trajectory in terms of performances and player pool sees them rise to No.5 in brand value.

“The IPL as a product has always been highly investible,” RR lead owner Manoj Badale is quoted as saying. “A closed league (no relegation) offers long-term security, a “hard” salary cap ensures a level-playing field and competitive parity, and an equitable commercial model in which central income is split equally amongst franchises secures contractual revenue for franchises.”

The first 10 years of IPL, as with any new sports property, can be thought of as the “proof of concept” stage. Fan affinity has strengthened whilst broadcasters and sponsors consider IPL to be a “must-have” property. This has provided a solid launchpad for the league to scale and simultaneously provided franchises with a new profile of investment that can unlock this new stage of growth and innovation.”