BCCI is poised for a fortune of at least Rs 400 crore, with some of the top business houses set to bid aggressively for the five Women’s IPL Teams (WIPL) which will be auctioned on Wednesday.
According to market experts, the teams are expected to pay “500 to 600 kroner INR” per team in a closed auction.
“The WIPL has tremendous potential, but most legacy teams want to mix optimism with pragmatism,” said an industry insider who was previously involved in bidding for the men’s IPL team. He told PTI ahead of the auction.
“Expect bids in the Rs 500 crore range. Rs 800 million plus might be a bit ambitious, but BCCI won’t complain,” he added. Over 30 odd companies, including all 10 men’s IPL teams, purchased bidding materials worth Rs 5,000. Well-known companies such as Adani Group, Torrent Group, Haldiram’s Prabhuji, Capri Global, Kotak and Aditya Birla Grouo have also expressed interest in buying the team.
In 2021, some of these ventures fell through when the BCCI called for bids for his two new men’s teams.
His traditional IPL teams Mumbai Indians, Rajasthan Royals, Delhi Capitals and KKR could seriously consider expanding the existing men’s team bouquet around the world.
According to market insiders, he has two principles for these bids by trading companies. The first is return on investment (ROI), which is a fundamental tenet of any business. It is the profit from what the company has spent.
The second is not a business principle per se, but is called the “Return of Ego” in the business world.
This is what some of the biggest corporate names are willing to pay as much when looking to buy a particular property, even if it takes five to seven years to break even. It means that you want to buy something at any price. His existing IPL franchise with a “steady revenue stream” can afford to “bleed” a bit more in the early stages. This is required.
A former IPL franchisee executive who once worked on the offer explained the reasoning behind the offer.
“Let’s say a franchise company wins a bid of Rs 500 crore in his five years, which means Rs 100 crore each for the next five years will be immediately pledged,” the source explained.
So what will be the revenue stream for the franchise? “BCCI shares revenue from media broadcasting, which is one of its primary sources of revenue. Second is a share from BCCI’s central sponsor pool. The fourth is gate sales, the money you get from tickets,” he elaborated.
What can franchisees get from WIPL’s media revenue pool? “BCCI will share 80% of media rights funds with the team for women’s IPLs (50% for men:
50) Support the development of sustainable models.
“So what about the mathematics here? JIO brought in media rights for 5 years with his 95 billion rupees (approximately) equivalent to about 19 billion rupees per year. 80% of him is 152 million.
“Let’s make a round number of 150 million rupees. That’s what each franchise earns over five years and equates to around Rs 300 crore per year,” he explained.
“Currently, BCCI distributes part of the central sponsor pool (title sponsor, co-sponsor and various award sponsors) with the franchise.To this is added the franchisee’s own revenue pool. from his 1.8 crore goal.