Chennai Super Kings first Team to Report Profit in IPL
India Cements breaks even in IPL!
At least one franchisee of the India Premier League (IPL) has crossed break-even numbers even as the inaugural 45-day, 59-match cricket tournament, launched by the Board of Control for Cricket in India (BCCI), wound to a close last week.
India Cements Ltd (ICL), owner of the Chennai Super Kings franchise that was runner-up in the trophy final, has made a marginal profit beating its own expectations by a year.
ICL had bid $91 million or about Rs 360 crore for owning the Chennai Super Kings team over a 10-year period
When the concept took off about four months ago, India Cements had expected that the actual break-even may happen in the second or third year. Unexpectedly, the cash registers have been ringing from the word go.
A consultant to the IPL had said that to do well, IPL had to “get eyeballs on the screen and bums on the seats!” That was a cheeky reference to television advertisement revenue and stadium collections. If the initial figures are any indication, they seem to have done just that.
Speaking on its successful run in the maiden edition of the IPL, Rakesh Singh, Joint President, (Marketing), India Cements, said ICL had spent about Rs 70 crore on the whole exercise so far. This included Rs 36 crore as franchise fee, Rs 24 crore for administration and players and staff salaries, and another Rs 10 crore for advertisements and promotions.
The revenue came mainly from the central pool (distributed by BCCI/ IPL), sponsors and gate collections. The popularity of the team and the game itself had seen gate collections at the M A Chidambaram stadium exceed Rs 13 crore.
Merchandising
The company is also hoping to get into merchandising in order to monetize the gains that the concept of IPL has made so far. “We hope that about 6 to 8 per cent of revenues should come out of this stream,” Singh said.
The company realised the potential after spectators lapped up team colour jerseys (yellow) for various matches. In sharp contrast, Reebok, one of the manufacturers of these jerseys, was able to sell barely a handful of India colours (blue) at the time of One-Day International matches featuring the national team.
