IPL 2022 is going to be as big as ever. Two new teams will be entering the league at a huge premium. While Chennai Super Kings (CSK) is set to become the first sports unicorn, Sunrisers Hyderabad (SRH) is calling it a zero investment asset. The team may now explore the option of IPO listing to unlock value and increase their shareholder returns.
The value of existing franchises has skyrocketed after the addition of two new franchises.
IPL 2022: What Sunrisers Hyderabad is going to do?
Sun TV which is the parent entity of SRH in IPL, Group CFO declared that the company is not averse to spinning off its IPL franchise as a separate brand nor will it explore the IPO listing to unlock the value and maximize its potential.
SL Narayan stated “If there is a way in which value unlocking can be done for the benefit of the shareholders, we would certainly look at it at an appropriate time. At this point in time, SunRisers is a division of Sun TV Network Limited and we disclose its revenues and costs every season.”
CSK becomes the first sports unicorn
CSK won the 2021 edition, which increase its share price in the grey -market. After Sanjiv Goenka bought IPL’s Lucknow franchise with a 7,000-crore plus bid and CVC Capital bought Ahmedabad franchise for 5,635 crores, Chennai Super King’s share price further went up.
N Srinivasan, the Managing director of India Cements told “Brand CSK will outgrow Brand India Cements. If you look at the history of franchise-based leagues in the US, it will outgrow everything. Passion for cricket is so much in India. The road between countries will see franchise-based leagues getting the precedence as we go along.”
CSK is the only sports team in India whose shares are available for public investment, and the performance of this team has always been to-notch so it attracts interest.
Other team’s owners have offers that are 12-15 times more than what they invested. It clearly states, even if franchises lose the league, the owners still win commercially.