Revenue and Profits

The UK-based brand consultancy, Brand Finance, has valued the IPL at 18,500 crore (US$4.01
billion) in 2010.[31] It was valued at U$2.01 billion in 2009 by the same consultancy.[32]

There are disputed figures for the profitability of the teams. One analyst said that four teams out
of the eight made a profit in 2009.[33] While the London Times said that all but Kings XI Punjab
made a profit.[34]

In 2010, the IPL expects to have 80 official merchandising deals. It has signed a deal with Swiss
watchmaker Bandelier to make official watches for the IPL.[35]

According to a recent study by a UK-based brand valuation consultancy, the brand value of the
IPL has more than doubled to USD 4.13 billion (over 18 crore (US$3.91 million)) from USD
2.01 billion in 2009.[36]

The franchises have been a part of this growth. Chennai Super Kings, who were ranked fourth
last year, has emerged the most valued franchise in 2010. The CSK franchise has moved up the
ladder to number one with a valuation of USD 48.4 million. The Kolkata Knight Riders co-
owned by Bollywood actor Shah Rukh Khan comes in second with a valuation of USD 46
million and the Rajasthan Royals, co-owned by Bollywood actress Shilpa Shetty comes in third
with USD 45.2 million. The Royal Challengers Bangalore, owned by Vijay Mallya, is ranked
fourth with a valuation of USD 41.9 million and is followed by the Mumbai Indians (USD 40.8
million), Delhi Daredevils (USD 40.5 million) and Kings XI Punjab ( USD 36.1 million). The
Deccan Chargers are at the base with a valuation of USD 34.4 million.[36]

Rank Franchise Brand Value

1 Chennai Super Kings $ 48.4 m
2 Kolkata Knight Riders $ 46 m
3 Rajasthan Royals $ 45.2 m
4 Royal Challengers Bangalore $ 41.9 m
5 Mumbai Indians $ 40.8 m
6 Delhi Daredevils $ 40.5 m
7 Kings XI Punjab $ 36.1 m
8 Deccan Chargers $ 34.4 m

Sponsorships

India's biggest property developer DLF Group paid US$50 million to be the title sponsor of the
tournament for 3 years from 2008 to 2010.[29]
Other year sponsorship agreements include a deal with motorcycle maker Hero Honda worth
$22.5-million, one with PepsiCo worth $12.5-million, and a deal with beer and airline
conglomerate Kingfisher at $26.5-million.[30]

The IPL Revenue Flow 2010

Posted on March 18, 2010 by Saumil Mehta

IPL 2010 to witness 14 per cent rise in viewership over last time: MEC study
By Sapna Nair, afaqs!, Mumbai, March 08, 2010
Section: News Category: Media Publishing

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The estimated average TVR for the third season of IPL is 5.2

The third season of the Indian Premier League (IPL) continues to be the talk of the town, with
just four days left for the inaugural match. mediaedge:cia (MEC) is out with its predictions about
the viewership of the cricketainment property this season.
For the last season, the media agency had predicted that the tournament would witness a 7 per
cent dip in viewership vis-à-vis Season 1, owing to the change of venue and the General
Elections in India. That prediction did come true, as the dip in viewership was apparent. This
time round, the agency predicts that though the TVRs would rise, they would not reach the levels
of the first season.

With a 14 per cent rise in viewership, IPL 3 is expected to rake in average TVR of 5.2 (C&S,
15+, SEC ABC), according to the study conducted by MEC across 10 cities, with a sample size
of 903 individuals. For the second season, the agency had predicted a 7 per cent dip in
viewership compared to the first season.

The agency has based its study on factors such as fatigue (since this is the third season of the
game), India being the venue, team popularity, player popularity and scheduling of matches. The
sample interviewed suggests that India's love for cricket is fervent and consistent.

Among the respondents, 60 per cent said that they loved the T20 format and yearned for more;
26 per cent thought that there has been overkill; and 15 per cent were still in favour of the ODI
format.

Of those interviewed, 54 per cent expressed the desire to watch more matches than in the last
season; while 27 per cent said there would be no change in their viewing habits. For those who
wanted to watch more matches, the major reason was that the tournament was back in India;
while the ones who would watch fewer matches believed there had been too much cricket lately.

According to the study, the viewing habits of T20 enthusiasts are influenced mainly by whether
their favourite team was playing, followed by whether the home team was playing. Interestingly,
team performance has very little influence. Statistics say that the favourite teams (which enjoy
the most support), such as Mumbai Indians and Kolkata Knight Riders, haven't even made it to
the semi-finals so far.

While teams enjoy high popularity in their respective regions, some, such as Delhi Daredevils
and Rajasthan Royals, need to strengthen their popularity in Delhi and Jaipur, respectively.

With only five off-primetime matches on weekdays, SET Max and viewers have reasons to
rejoice. Unlike season two, which had a majority of weekday matches; most of the matches in
the third season are scheduled on weekends, similar to that of the first season. MEC predicts a 5-
15 per cent dip in GECs' share, due to the matches.
It has been observed that the number of viewers tuning into the matches was higher (around 21
million new viewers) in the second season compared to first; but the time spent had decreased.
This trend is expected to continue.

Respondents could remember DLF and Vodafone as the top two brands associated with IPL,
followed by Hero Honda and Kingfisher. IPL, this time, will be screened on newer platforms
such as cinema halls and video sharing portal, YouTube. However, only 38 per cent of those
interviewed were aware of it. Moreover, most of the viewers preferred watching the matches at
home, with family and friends.

IPL TAXATION
The official added that the government could expect to generate about Rs150 crore in taxes from cricket
alone.

If IPL’s nearly Rs800 crore revenue for 2009 is anything to go by, the income-tax department could depend
on the tournament for more than 50% of its collections from cricket.

In addition, the Union Budget also seeks to levy taxes on sponsorship revenues, which were until now
excluded from service tax. The document states: “In the definition of ‘Sponsorship Service’, the exclusion
relating to sponsorship pertaining to sports is being removed.”

Sports experts believe the government’s decision to levy tax on sponsorship revenues, though still hazy,
makes sense for billion-dollar tournaments such as IPL. “When the government says ‘sports sponsorship’,
what they really mean is cricket because if it’s sport-by-sport they will end up crippling sports in India if
they tax table tennis, hockey and other such sports which have no money, so the government needs to
make a distinction,” said Boria Majumdar, author and sports historian. “Having said that, I think the
government decision to impose tax on sports sponsorship is a fair call for cricket because events like IPL
makes billions in sponsorship revenues and each step is commercial, yet BCCI is a registered society. So it is
only fair.”

VIEWERSHIP

The third edition of the Indian Premier League (IPL) has managed a cumulative reach of 108 million
viewers in just 14 matches, demonstrating that the T20 league is fast replacing other cricketing
content as the hottest property.

The IPL in its inaugural edition had reached 77 million viewers in 14 matches, and then gone on to
amass 96 million viewers in its second season.

The third edition of the IPL, currently on display, took 10 matches to reach 100 million viewers
compared with 51 matches in the first season and 23 matches in the second season, signaling the
growing popularity of the T20 format for TV viewers.

Tam data, in fact, shows people are tuning in to the games even on weekdays and not just on
weekends or holidays. Interestingly, the top-rated match this year was recorded on a Wednesday as
the contest between Mumbai and Delhi earned a TVR of 6.24 on 17 March.

The average TVR this year is 4.69, which is slightly lower than the TVR of 4.97 in the first year. In
the second year, the TVR was 4.52.

It is somewhat surprising that 40 per cent of the IPL’s viewership is coming from the 35+ TG. The
SEC split is relatively even, as indicated by the Tam data.