The recent high-value sales of Royal Challengers Bengaluru and Rajasthan Royals—together exceeding ₹31,000 crore—have sparked debate among industry experts over whether the valuations reflect actual financial fundamentals.

On March 24, a consortium led by the Aditya Birla Group acquired Royal Challengers Bengaluru (RCB) for approximately ₹16,700 crore, while Rajasthan Royals (RR) was bought by a US-based group led by Kal Somani for around ₹15,290 crore. The combined deals underline the surging commercial appeal of the Indian Premier League.

However, Santosh N of D&P Advisory questioned the logic behind such steep valuations, calling them “very difficult to understand.” He pointed out that just a year earlier, Gujarat Titans was valued at under $1 billion, making the near doubling of franchise valuations puzzling.

According to the expert, the growth in valuation does not align with recent developments in the league’s ecosystem. Factors such as uncertainty around broadcasting rights renewal, lack of major sponsorship deals, and regulatory challenges like real-money gaming restrictions have not supported such exponential increases.

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He further explained that IPL franchises typically generate around ₹700–₹800 crore annually, including roughly ₹500 crore from central revenue pools and ₹200–₹300 crore from sponsorships, ticket sales, and merchandise. Despite this, teams are being valued at nearly 20 times their annual revenue, raising concerns about sustainability and return on investment.

Meanwhile, the RCB deal also involves the transfer of a 100% stake from United Spirits Limited, a subsidiary of Diageo. The agreement includes both men’s and women’s teams, though it remains subject to approvals from governing bodies like the Board of Control for Cricket in India and regulatory authorities.

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