It is a credit to the business model that IPL commissioner Lalit Modi devised for the IPL that most teams have turned a profit for their franchisees in just the second year of the IPL, whereas generally speaking sports leagues take years before they can hope to make a profit. The zeroes to heroes team Deccan Chargers; last year’s stragglers have won the IPL this year and as the IPL title holders now expect to make a profit of 40 to 50 crores (which would include the revenues from the T20 Champions League in October according to the cricket news).

Whereas last year it was KKR that was supposed to be the team that made the highest profit, this year it is estimated that Delhi Daredevils team will be the most profitable, and along with the Deccan Chargers team, is expected to contribute between 5 and 20 per cent of the company’s core profit. Broadcasting revenues are expected to double and all teams will get very considerable fees in terms of central sponsorships as well as in stadia advertising and gate revenues.

Further the teams such as finalists Deccan and Royal Challengers Bangalore will benefit from increased valuations this year. Another benefit will accrue to the teams from the compensation they will receive from the BCCI for the shift in venue from India to
South Africa.

As for the BCCI if the costs in conducting the tournament abroad has meant that extra expenditure has been incurred; however revenues and therefore profit is also expected to increase marginally this year over last year. Whereas earlier estimates had put the figure of earning by the BCCI at about Rs 450 to 500 crore this year, now with the change in venue to an overseas location the net profit will be lower; pegged at about Rs. 350 crores, which is however still higher than last year’s income of Rs 305 crore.

The sale of the telecast rights of the IPL was the main source of the BCCI’s income which was renegotiated as per an out of court settlement. Advertising and franchisee fees are other areas that the BCCI makes its money. As of now, estimates put the figure of Rs 225 to 240 as being the collective profits for the franchisee teams; the increase coming mainly thru an increase in broadcasting rights.

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3.25 Copyright (C) 2007 Alain Georgette / Copyright (C) 2006 Frantisek Hliva. All rights reserved."

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