At least some Indian Premier League teams seem to be spinning in the right direction.
At least some Indian Premier League (IPL) teams seem to be spinning in the right direction. Out of a total of eight teams, four have declared their FY17 earnings with the Registrar of Companies and Tofler and of these, three have declared a profit during the fiscal. In FY16, of these four teams, two had posted a profit while the other two had turned in a loss.
While the Shah Rukh Khan-owned Kolkata Knight Riders (KKR) has largely been profitable all along, the United Spirits-owned Royal Challengers Bangalore (RCB) for the first time in the last four years posted a profit during the fiscal. Kings XI Punjab, which posted a profit of Rs 6.6 crore in FY17, has also been consistently posting profits for the last three fiscals. It had posted a loss of Rs 4 crore in FY14. But the GMR-owned Delhi Daredevils continues to be in the red. It had posted a profit of Rs 7 crore in FY14 but since then has posted losses every fiscal year.
“KKR has always managed to cash in on the Shah Rukh Khan factor that has allowed the franchise to earn a higher sponsorship revenue ranging between Rs 40-45 crore. As for RCB, in the initial years the franchise used a lot of its in-house brands instead of getting third-party sponsors on board, but now that has changed as the franchise’s sponsorship revenue ranges between Rs 35 crore and `40 crore,” said Indranil Das Blah, co-founder, Kwan Entertainment.
In FY17, KKR posted about a twofold jump in its profit to Rs 19.7 crore. Its revenue increased 23.7% to Rs 154.2 crore.
Similarly, RCB during the year posted a profit of Rs 3.15 crore against a net loss of Rs 43.9 crore in FY16. The Bengaluru-based franchise posted a 19.8% jump in revenue to Rs 162.1 crore during the year. Increase in sponsorship revenue is one of the reasons behind the turnaround in its financials. RCB’s sponsorship revenue increased 38% in FY17 to Rs 39.6 crore.
Kings XI Punjab — co-owned by the Dabur Group’s Mohit Burman, actress Preity Zinta, GoAir promoter Ness Wadia and APJ Surrendra Group’s Karan Paul — saw its profit grow 100% to Rs 6.6 crore in FY17. However, the Mohali-based franchise’s revenue remained flat at Rs 106.9 crore. The reduction in total expenditure by 3.8% to Rs 100.3 crore is one of the reasons behind increase in profits.
Delhi Daredevils saw a widening of its losses to Rs 9 crore in FY17 from Rs 6.1 crore in FY16. Revenues too dropped to Rs 132.1 crore in FY17 from Rs 133.2 crore in the previous fiscal.
However, Hemant Dua, CEO, Delhi Daredevils, told FE that the franchise has made a profit of Rs 9 crore in FY18. “We managed to turn around the business in 2017, by reducing cost of acquiring players and increasing other sources of revenues. In fact from 2018 onwards we expect further increase in revenue as earnings from central pool is expected to rise on the back of BCCI (the Board of Control for Cricket in India) being able sell telecast rights to Star India at higher rate,” Dua said.