BEST BRAND LAUNCHES OF

2008
INDIAN PREMIER TATA NANO
LEAGUE 

Concept developed by Lalit Modi is a Concept by Ratan Tata is the most

very successful brand. successful

brand launched.


It has taken cricket to newer heights. It has become iconic name for certain
things…

It already has two very successful seasons. The commercial success is yet to be
proven.

The concept was new but with proper Auto industry giants were sure that the car
vision it is a grand success. can’t be produced.
 Introduction
• Launched by BCCI on the line of Football’s
English Premier League and National
Basketball League (NBA) of the US.
•
• Professional Twenty20 cricket league created
and promoted by BCCI and backed by ICC.
•
• 8 teams, 44 days, and 59 matches.
•
• Total base price for auction was $ 400 million
and fetch $ 723.59 million.
•
• Most expensive franchise is owned by Mukesh
Ambani - $ 111.9 million.
 Contd
• DLF Universal secured exclusive rights to the IPL
title sponsorship worth Rs. 200 Cr (over $50 mn)
for 5 years.
•
• India’s Sony Television network and Singapore based
WSG secured broadcasting rights at a cost of $
1.026 bn for 10 years.
•
• Bring income of $ 1 bn to BCCI over a period of 5 to
10 years, out of which 40% will go to IPL, 54% to
franchise, and 6% as prize money until 2017.
•
• Out of $ 1.026 bn, $ 918 mn to BCCI and $ 108 mn
for the promotion of the tournament.
•
• 20% would go to IPL, 8% as prize money, and 72%
 So where is the money coming
from…..
Media Rights Central Money raised by Franchise Bid
Revenues Franchises Money

$ 1 B illio n fo r ►Title ►Selling ►Mumbai($111.9M)

advertisemen ►Bangalore($111.5M)
1 0 ye a rs Sponsorship ►Hyderabad($107M)
of event t for
►Chennai($91M)
S o n y stadium ►Delhi($84M)
►Licensed ►Licensing
 ►Mohali($76M)
Merchandised products ►Kolkata($75M)
►Merchandise ►Jaipur($67)
sale
►Advertising on
Tickets
►Gate Money
 … and where is it going??
Money BCCI Franchises Players
Source

Media Rights 20% 72% 8%

(equally divided) (Prize Money)

Central 40% 54% 6%

Revenues Subject to
franchises wish
Money Raisers 20% 80% 0% (Depends on
by Franchises the whims of the
franchises)

Franchise Bid Some hefty

Money amount in the
first year
 IPL VALUATIONS AND REVENUE
STREAMS
• ACCORDING TO A BRAND FINANCE STUDY
DONE DURING SEASON 2 , THE IPL AS A
STANDALONE BRAND VALUE OF OVER $
311 M AND THE ENTIRE ENTERPRISE
VALUE THAT INCLUDE ITS FRANCHISES IS
VALUED AT $ 2.01 BILLION. THIS IS
EXPECTED TO HAVE RISEN
CONSIDERABLY WITH SOME ESTIMATING
A 50% JUMP.
 REVENUE STREAMS
• BROADCASTING RIGHTS TO MULTISCREEN MEDIA
AND WSG FOR 10 YEARS FOR RS 8700 CRORE.
• GLOBAL THEATRE- SCREENING AND PUBLIC
VENUE RIGHTS SOLD TO ENTERTAINMEMT
SPORTS DIRECT FOR RS 330 CRORE FOR 10
YEARS . REVENUE SPLIT IN 50: 50 B/W ESD AND
IPL
• ONLINE STREAMING RIGHTS SOLD TO TO GOOGLE
/ YOUTUBE FOR AN UNDISCLOSED SUM
• FRANCHISE FEES : RS 333 CRORE PER YEAR
• Let us consider the probable balance sheet of
Mukesh Ambani’s Mumbai Indians (MI). IPL
team owners
• have two channels of revenue, central and local.
• Central - Includes Media, sponsorship and
suppliers, which BCCI will sells and shares with
the teams.
• Local - Includes things like stadium ticket sales,
local sponsorship. Concessions, merchandise et
al, which franchisees will be responsible for
selling.
•
 

ENTRY EXPEN INCO
Approximately $ 5 SES ME
Million will be the first Franchise Fee ($ 111.9 for
year losses of MI. 10 year)
11.19 0
Financially, the Players’ salary 4 0
franchise seems to have Stadium leasing, coaches and
overspent. Moreover, other exp. 1.25 0
the percentage of Advertisements 1.25 0
central revenue, which TV rights ( $ 1 Billion for
remains 80% for the 10 Years ) (central)
0 10
first two years, will Sponsorships ($ 50 Million 0 0.75
for 5 years)
subsequently reduce to tickets, food and other 0 2
50% in year 11. If the sales ( local)
Total 17.69 12.75
franchise is to make
money, they will have Net losses 4.94
to do that from
tickets, food and other

sales as well as
premium and box seats.
(Mainly because the two
major sources of
revenue, TV rights and

Title sponsorships are

 Money Matter
• Let us first look at how much money BCCI is making out of this
entire deal.
• The auction for the team franchise, which took place on January
24, 2008, and the total base price for the auction was $400
million. The auction went on to fetch $723.59 million
• Television Rights: On January 14 2008, consortium consisting of
India’s Sony Television network
• and Singapore-based World Sports Group secured the rights of the
IPL. The record deal has duration of ten years at a cost of
$1.026 billion.
• Title Sponsorship Rights: On February 13 2008, Indian real
estate developer DLF Universal secured exclusive rights to the
IPL title sponsorship worth Rs 200 crore (over $50 million) for
five years.
• The major chunk of the revenue will go to BCCI even if we factor in
the condition that some percentage of money generated from
the auction of television rights and Title sponsorship will go to
the team owner. BCCI has played the game very smartly - head


• Indian Premier League ushers in a new era of

marketing of sports in India. We take this
opportunity to analyze
• IPL and compare it with leagues like EPL and ICL
(Indian Cricket League).
• IPL- already a US$2bn property, is essentially an
attempt to sell cricket as a reality show.
Creation of club culture – would be key to its
success. Nevertheless IPL provides a new
entertainment genre which cuts across classes.
• Some of the franchisee would look at IPL as a
means to promote their brand (UB group) while
the others would look it as a financial
 The concept is yet to evolve and revenues streams though
difficult to predict would be numerous. Our belief is that the
three successful teams could easily do revenues of Rs3bn
per year in the next three-four years and all the teams are
likely to turn profitable after two-three years. Their OPMs
could range from 15-20%. Value unlocking for teams would
happen through listing and P/E participation. The world
over, average teams like Tottheham Hotspurs are trading at
a 1.5X sales while a successful team like Manchester have
been sold for 2-5X sales.
• Investors looking for an exposure to IPL should look at
investing in India Cements Ltd. We believe that the
company would be EBIDTA positive in the first year. On
conservative basis, it is likely to earn a turnover of Rs3bn
from IPL in the next three-four years. Assuming a m
cap/sales multiple of 2X, the value per share wouldbe
Rs20.
 Key features of IPL

• The Indian Premier League or IPL is a 20-20 format cricket

tournament. This league was formed by the Board of
Cricket Control of India (BCCI) and sanctioned by the
International Cricket Committee (ICC).
• IPL has been conceived on the lines of the English premier
league, where local football teams with a defined fan
base (supporters) play against each other.
• The idea behind IPL is to sell cricket as a high involvement
reality show that would appeal to all audiences.
• IPL has eight teams sold to franchises for perpetuity. These
franchises can run the league in their individual styles
and can raise resources from the primary market. The
teams have been capped at 10 – with one at the end of
every three years.
 Continued….
• SONY-WSG has bagged broadcasting rights for 10 years for
US$918mn, excluding marketing for US$108mn.
• The franchise amount collected is US$724mn, with each of
the clubs being sold for US$67-112mn, depending on the
city.
• Besides acquiring teams, each of these franchises has
spent US$6-7mn on acquiring players for their teams.
• A total of 59 matches, including finals and semi–finals will
be played in this season. (56 league matches plus two
semi finals and one final). 7 matches are to be played on
the home ground.
• Its final leg will be called ‘Champions Twenty20 League’ and
all the finalists from across the world will play in it. The
champion team will get US$5mn – the highest ever price
money in a cricket event.

 The broadcasting angle


• The BCCI created history when it sold television rights of this yet
untested format to Sony–World Sports consortium for
US$1.02bn.
• However, of this US$1.02bn, US$108mn is to be spent by Sony on
promoting the event over the next 10 years. This brings down
the actual cost to US$918mn.
• Of this US$918mn, Sony has to pay US316mn for rights of
broadcasting for the first five years, and then pay
• US608mn – if this format has been remunerative in the first five
years.
• In the first year, payouts are not dependent on TRPs. However,
TRPs would drive payouts from the second year.
• The franchisee have a share of 80% in the first year decreasing to
60% in the fifth year of broadcasting rights and the balance
would go to IPL.
• There is an overall cap of US$918mn on the rights which can be
shared with the franchisees.
 ICL vs. IPL: The Competitive Edge

1.Solid backing of BCCI 1.ICL has a single

and ICC with almost 10 promoter Essel Group.
huge stakeholders.
2.IPL is playing a safe 2. Create a new league of
game talent from upcoming
aspirants.
3.attractive business model 
involving high level risk 3. Level of risk is
comparatively lower.
 IPL better than ICL

78% said Yes IPL is9: Isbetter

Exhibit IPL Better than
than ICLICL,

14% said No, and 14% 8%

8% said to an extent it is better than ICL

78%

To an extent Yes No
 The gambling
dashboard
High
BCCI Franchises
Return

Sponsors

Viewers
Players
Size of
Revenues

Low
Low High
Risk

31
 While it is a great bonanza for
players…

The Upside - Returns

• Earn at least Rs 80 lakhs ($200000) or more per

season on average.
• Bonuses and Prize Money from Team owners.
• A great stage to show case skills and compete with
the best in the world.
The
• Downside - Risks


• Taxing on the already tight schedule of

international cricket. Chances of injury lowering
the tenure of career.
• Conflicting commitments for the national boards.
• Neglecting other forms of cricket
•
 …the franchises are alternating
between grinning and grimacing….
The Upside - Returns

The Downside - Risks

…and the sponsors are walking a
tight line as well
The Upside - Returns

The Downside - Risks

 IPL
Aggressive Marketing
or
Futuristic strategy?
 IPL – ‘Manoranjan ka
baap'


“If all the development programmes

are put in place, it could usher in a
new chapter. I sincerely believe that
the IPL is history in the making” [….]
“For me, the most fascinating aspect
of Indian cricket is the passion the
crowds have for the sport. It is
amazing and it is no wonder [...] -
Adam Gilchrist
 CRICKET UNLIMITED…..
BIGGER ON EVERY COUNT
•
•
•
•
• MATCHES TEAMS PLAYERS IPL BRAND IPL
FOR VALUATION ENTERPRIS
AUCTION E
IPL3 60 8 66 $311m+ $2.01b
VALUATIO
N
IPL4 94 10 300 50% 50%
MORE MORE
 Cont…
• DLF Universal secured exclusive rights to the IPL
title sponsorship worth Rs. 200 Cr (over $50
mn) for 5 years.
• India’s Sony Television network and Singapore
based WSG secured broadcasting rights at a
cost of $ 1.026 bn for 10 years.
• Bring income of $ 1 bn to BCCI over a period of 5
to 10 years, out of which 40% will go to IPL,
54% to franchise, and 6% as prize money until
2017.
• Out of $ 1.026 bn, $ 918 mn to BCCI and $ 108
mn for the promotion of the tournament.
• 20% would go to IPL, 8% as prize money, and
72% would be distributed to the franchisees
 Future Expansion
• Four new franchisees will join IPL in 2010-11.
• Two confirmed franchisees will be based in
Ahmedabad and Kanpur.
• In 2012-13, two more teams will join the IPL.
• Possibly second franchise from Delhi’s suburbs.
• Possibly second franchise from Mumbai or new
franchise from Pune.
• For 2009 season tentative dates for the IPL will be
April 10th , 2009 to May 29th , 2009 and format of
the tournament will remain the same as that of
the inaugural season.
 Profit or Loss?
Franchise Revenues Expenses Profit/loss (in Price
(in Crores) (in Crores) Crores) (USD)
Mumbai Indians 69 85 Net Loss 16 $ 111.9 mn
Royal Challengers Banglore 45 88 Net Loss 43 $ 111.6 mn

Hyderabad Deccan Chargers 64 82 Net Loss 18 $ 107 mn

Chennai Super Kings 72.8 73 Net Loss 0.2 $ 91 mn

Delhi Daredevils 70.4 77 Net Loss 6.6 $ 84 mn

Kings XI Punjab 66 68.4 Net Loss 2.4 $ 76 mn

Kolkata Knight Riders 89 76 Net Profit 13 $ 75.09 mn

Rajasthan Royals 59 53 Net Profit 6 $ 67 mn

 ICL vs. IPL: The Competitive
Edge
• Solid backing of BCCI and ICC with almost 10
huge stakeholders whereas ICL has a single
promoter Essel Group.
• IPL is playing a safe game while ICL wants to
create a new league of talent from upcoming
aspirants.
• IPL seems to be attractive business model
involving high level risk while in ICL level of risk
is comparatively lower.

 Research Analysis

• A research was
conducted across E x h ib it 1 : D id Y o u F o llo w IP L M a t c h e s o n T V
400 people in the
city of Nagpur. 17%

• 83% said Yes and 17%

No
• 83%

No Y es
 Cont…
• 44% did not miss a Ex h ib it 2 : M a t c h e s o n T V Fr e q u e n c y
single match, 38%
favorite teams 12 % 6%

matches only, 12%

44%
match highlights, 38%

and 6% only on
holydays, sundays M atches hig hlig hts o nly A ll the matches (d aily)
M atches o f f avo rite teams o nly
o nly o n ho lid ays / S und ays / W eekend s

and weekends

• 58% found a sustained Exh ib it 3: Su s tain e d L e ve l o f In te r e s t
Throughout
 interest level
throughout the match, 8%
34% surfed through 34%

the channels and 8%

are not interested 58%

To an ex tent Y es No
• 63% because of crisp Exhibit 4: Attr action Facto r s

timing, 29% others

factors attract them, 70
60
63

5% said that 50
Pe r ce n tag40
Bollywood stars e 30
29

20
tempted them to 10 5 3
watch, and 3% 0
Bolly w ood Entertainment

found entertainment s tars v alue

Facto r s
value
• 62% preferred 8 to 11 E x h ib it 5 : P r e f e r r e d T im e S lo t o n T V
pm, 12% no specific
70%
time to watch TV 60%
50%
62%

and equal number P e r c e n t a g43 00e %

%
preferred to watch 20%
10% 5% 9%
12% 12%
0%
TV after 11 pm, 9% 7 .0 0 to 8 .0 0 to No
9 .0 0 a m 1 1 .0 0 s p e c if ic
preferred afternoon pm tim e

slot of 2 to 5 pm, T im e

and 5% preferred
morning time of 7 to
9 am
• Only 24% did miss out E x h ib it 6 : M is s e d O u t o n F a v o r it e P r o g r a m
on their favorite TV
programs, and 76% 24%

answered negatively
76%

Yes N o
• 60% said that IPL E x h ib it 7 : C h a n g e in T V H a b it
brought about a
change in their 11%

viewing habit, 11% 29%

said that viewership

pattern changed to
certain extent, and 60%

29% felt that it did

not affect their T o a n e x t e nY te s N o

viewership pattern
in any way
• 38% feel that TRP of E x h ib it 8 : E f f e c t o f IP L o n T R
reality shows
affected the most,
28%
30% feel news Fa m ily Soaps

channel would have R e a lity S h o w s 38%

suffered that most,

28% said family N ew s
30%

soaps were O th e r s 4 %
affected, and 4%
feel that other
channels affected
• 78% said Yes IPL is E x h ib it 9 : Is IP L B e t t e r t h a n IC L
better than ICL, 14%
said No, and 8% 14% 8%

said to an extent it
is better than ICL
78%

T o a n e x te Yn te s N o
• 37% feel that IPL is all Ex h ib it 1 0 : IP L f o r m e
about aggressive
marketing, 31% said 6% 26%
that great futuristic 31%

strategy, 26% feel

37%
that IPL is just a 45
days of masala, and D a y 4 5 m a s a la o f p o u rOr in ly a g g r e s s iv e m a r ke tin g
6% feel it is threat F u tu r is tic s tr a te g y T h r e a t to TV a n d C in e m a
to TV and cinema
 There’s a lot for U, Me and
Hum….
The Upside - Returns

The Downside - Risks

 Ex h ib it 1 0 : IP L f o r m e

s 6% 26%
31%

37%

D a y 4 5 m a s a la o f p o u O
r r ni ly a g g r e s s iv e m a r k e tin g
F u tu r is tic s tr a te g y T h r e a t to T V a n d C in e m a

• 37% feel that IPL is all about aggressive

marketing,
• 31% said that great futuristic strategy,
• 26% feel that IPL is just a 45 days of
masala, and
• 6% feel it is threat to TV and cinema
Global Appeal
BUILDING A GLOBAL SPORTS
FRANCHISE
1) LOCAL COMMUNITY
 2) Superstars
 It is clear that certain players inspire
supporters.


 Sports fans will pay to see those few

sportsmen who are capable of
displaying extraordinary levels of
talent.


 These inspirational players not only help

build the club brand but can also add
3) MEDIA EXPOSURE
 THE BIGGEST BRAND
RANK BRAND VALUES
V A LU E( S EA S O V A LU E ( S EA S O N
N 2 ) 1)
01 K O LK A T A K N IG H T R ID E R S $ 4 2 .1 m $ 22 m

02 M U M B A I IN D IA N S $ 4 1 .6 m $ 17 m

03 R A JA S T H A N R O Y A LS $ 3 9 .5 m $ 14 m

04 CHENNAI SUPER KINGS $ 39.4 m $ 18 m

05 DELHI DAREDEVILS $ 39.2 m $ 19 m

06 ROYAL CHALLENGERS BANGALORE $ 37.4 m $ 14 m

07 KINGS XI PUNJAB $ 36.3 m $ 15 m

08 DECCAN CHARGERS $ 34.8 m $ 11 m

 Owner: Mukesh Ambani


 Franchise Fee : $ 190.0 million



 Current Value: $41.6million



 New Signee : Kieron Pollard



 Most expensive player : Kieron Pollard - $1.8 million



 Profitability in season 2 : Rs 35.1 crore



The team had less mileage outside India as it had less or no players representing their
nation other than Sri Lanka &
South Africa
 Owner: Deccan Chronicle

s


 Current Value : $34.8 million



 Most Expensive Player : Andrew Symonds - $1.35 million



 New signee : Kemar Roach



 Profitability in season 2 : Rs 14.8 crore



 Home Ground : Secunderabad

Owner ‘s: Bollywood actor ShahRukh Khan's Red Chillies Entertainment
in partnership with Juhi Chawla Mehta and her husband, Jai Mehta.

Brand Value: $42.1 million

Icon Player : Saurav Ganguly - $1.09 million

Profitability in season 2 : Rs 25.8 crore

Home Ground : Eden Gardens

Shahrukh Khan's popularity has helped in enhancing the brand image of

Kolkata Knight Riders

The fan following of the team is the highest among all the teams in IPL

Shahrukh Khan‟ brand and the in-stadium marketing strategies

of the team have influenced the teams brand value resulting in
higher income from gate receipts, merchandising revenues and
by attracting new team sponsors”
 CHENNAI SUPER KINGS
• Owner: India Cements
• Most Expensive Player : Andrew
Flintoff - $1.55 million
• Brand Value: $39.4 million
• Profitability in season 2 : Rs 21.8
crore
• Home Ground : Chennai
•
• Owner: Dr. Vijay Mallya( UB group)
• Most Expensive Player : KEVIN
PIETERSON
• Brand Value: $37.4 million
• Profitability in season 2 : Rs 8.1
crore
• Home Ground : Chinnaswami
stadium ( Bangalore)
•
 Delhi daredevils
• Current value : $ 39.4 million
• Star player : Sehwag,
Gambhir,Dilshan
• New signee : Wayne parnell
• Sponsors : Hero Honda, Coco Cola ,
Adidas
• Profitability in season 2:Rs 35.1 crore
 Kings 11 Punjab
• Current value : $ 36.3 million
• Star player : Yuvraj , Sangakkara,
Irfan, Marsh
• Sponsors : Dabur, Reebok, Emirates
airlines
• Profitability in season 2 : Rs 26.1
crore
Current value : $ 39.5 million
Star player : Shane Warne, Watson, Graeme Smith
Sponsors : Ultratech, Kingfisher, Puma
Profitability in season 2 : Rs 35.1 crore
 Future Expansion
• Four new franchisees will join IPL in
2010-11.
•
• Two confirmed franchisees will be based
in Ahmedabad and Kanpur.
•
• In 2012-13, two more teams will join the
IPL.
•
• Possibly second franchise from Delhi’s
suburbs.
•
Conclusion
 Finally…

 CHILL OUT
 and

 ENJOY CRICKET WITH

FEW EYE CANDIES!!!!!

N O W H E R E ….. A N Y W H E R E ……..
IP L IS O N LY H E R E !