IPL 2016 Revenue Stream

The Indian Premier League has amassed about Rs. 2500 crore in overall revenue in its recently concluded ninth season, growing at a double digit pace over the year before. The figure includes revenue that TV and digital channels made from advertisements, as well as teams from sponsorship, ticket sales and merchandising, and BCCI from on-ground sponsorship.

The biggest chunk of revenue came from TVs as advertisers vied to grab ad spots when matches were telecast during the nearly two-month long tournament, which with its fast paced short format has become very popular in this cricket crazy nation. Official broadcaster Sony Pictures Networks India (SPN) made just under Rs 1100 crore while the eight IPL franchises together earned Rs 200-230 crore from Sponsors.

The Board of control for Cricket in India generated Rs 220-250 crore from on-ground sponsorships, whereas Hotstar the digital rights holder got around Rs 40 crore. This season IPL made ticketing revenue of Rs 150-160 crore. India is a market where a lot of new brands are launching. This need to chase salience and eyeballs and IPL viewership has remained rock. IPL is celebrated like a festival that unites once a year and brings families, friends and colleagues together to enjoy the spirit of cricketainment.

IPL has developed many unique skill sets and generated lot of job opportunities that are making a difference to the larger sports and events industry in India. In terms of ticketing revenue, Royal Challengers Bangalore (Rs 25-26 crore), Mumbai Indians (Rs 24-26 crore) and Delhi Daredevils (Rs 22-24 crore) topped the charts, followed by Rising Pune Supergiants (Rs 18-20 crore), Kolkata Knight Riders (Rs 16-18 crore), Sunrisers Hyderabad (Rs 15-16 crore), Gujarat Lions (Rs 14-15 crore) and Kings XI Punjab (Rs 13-14 crore). The BCCI ended up with almost Rs 10 crore in its kitty from ticketing revenue.

IPL is progressively growing at a 10-12% rate year on year. It may not be galloping, but it is definitely not sinking either. It is going in the right direction. Another small revenue stream for the franchises was merchandising, which is estimated to have generated Rs 17-20 crore for the teams put together. While it is hard to put a definite number to it, there is substantial revenue to the broadcaster from the TV channels that are subscription based.

SPN may allocate this revenue, estimated to be anywhere from Rs 250 crore to Rs 400 crore to the three channels – Sony Max, Sony Six, and Sony ESPN, which air IPL. SPN payout to the BCCI of Rs 820 crore per year (the 10 year deal is worth Rs 8200 crore) as well as Franchises fee has not been considered for the estimates. A major chunk of this goes into a central revenue pool, from where it is distributed among the Franchises.