IPL ecosystem valuation soars to Rs 92,500 crore in 2023 from Rs 87,000 crore in 2022

The Indian Premier League (IPL) ecosystem has witnessed impressive growth, surging from Rs 87,000 crore in 2022 to Rs 92,500 crore in 2023, marking a 6.3 percent increase, as per a report by D&P India Advisory Services LLP. IPL has always been a blend of cricket, business, and entertainment and the 2023 edition was no different.

This year marked also a significant change in the IPL's broadcasting landscape. The BCCI (Board of Control for Cricket in India) took a strategic step of splitting media rights between TV and digital platforms. This led to intense competition between Disney Star, the official TV broadcaster, and JioCinema, the OTT streaming partner. According to the Broadcast Audience Research Council (BARC) India, Star Sports Network's IPL telecast garnered 505 million viewers, with a 427.1 billion minutes of watch time. On the digital front, JioCinema reported 449 million viewers, with over 126 million opting for connected TV.

Measuring the valuation

As per the report, IPL's valuation encompasses both franchise team owners and the BCCI. Revenue streams are split into central pool (media rights, sponsorships) and franchise-specific (team sponsorships, gate receipts, merchandise). The central pool, primarily from media rights, contributes 80-85 percent of total revenue. BCCI gets 50 percent of the central pool, with a 20 percent profit share from franchises. This leads to BCCI receiving 60 percent of the central pool and a fifth of franchise-specific revenues. However, in terms of margins, older franchises enjoy a 50 percent operating margin, while the BCCI boasts a 90 percent margin on their net revenue share.

Team valuation analysis

The IPL ecosystem, as per the report, is valued at USD 11.2 billion, with the BCCI accounting for 60-65 percent of it, while all IPL teams make up the remaining 35-40 percent. This means all franchises collectively are worth around USD 3.9-4.5 billion, averaging USD 390-450 million per team. Notably, the central pool constitutes 70-75 percent of each franchise's revenue, ensuring a relatively similar intrinsic value. The Mumbai Indians hold a value within the USD 410-450 million range, making them the most valuable IPL franchise in 2023.

Women’s Premier League (WPL) on a growth trajectory

The inaugural WPL edition is valued at Rs 1,250 crore (approximately USD 150 million), primarily due to lucrative media and title rights deals. Viacom 18 secured media rights for Rs 951 crore (Rs 7.09 crore per match), making it the second most valuable broadcast agreement for a women's sports league globally. The Tatas invested Rs 165 crore for the title sponsorship. Franchises' cumulative sale proceeds reached a remarkable Rs 4,670 crore, showcasing strong confidence in the league's future success.