The IPL is as much about cash as cricket and the balance sheet matters the same as the score-book does in the game of cricket. Started in 2008, the Indian Premier League’s valuation has become a whopping US$6.7 billion. The IPL Governing Council (BCCI) alone easily earns over US$ 350 million a year. IPL contributes to more than 60% of the total BCCI earning. How did IPL become so big monetarily? Who pays? And what for? Are franchises profitable too? Let’s dig deeper and understand where the money comes from and who gets what?

The Revenue Wagon-wheel

Any discussion about IPL begins with eye-popping broadcasting deal numbers (central rights) – Star India’s contract with BCCI is humongous and has been a major contributor to the rapid growth of the league. Let’s have a quick look at all the 3 major revenue streams.

1. Broadcasting rights:

A major chunk of revenue earned is through broadcasting rights. In 2008, at the commencement of IPL, Sony and World Sports Group (WSG) held in partnership the global broadcasting rights for 10 years at US$ 1.03 billion, which is about US$ 103 million per year. In 2018, Star India acquired a 5-year contract for the global media rights for US$2.55 billion which is approximately US$ 510 million per year. A 5 times increase in broadcasting rights per year. This figure puts IPL at No. 8 across all leagues globally.

2. Sponsorship:

There are different types of sponsorship- title, corporate sponsors, umpire sponsor, associate sponsor, co-sponsor, etc. The biggest contribution amongst sponsorships is by title sponsorship. The increase in title sponsorship each year shows how massively the IPL is growing every year. Total sponsorship including title and associate sponsorship amounts to nearly US$ 100 million annually

Franchises also raise team sponsorship on their own for the kit, equipment, etc., which is in the range of US$ 4 – 10 million depending upon the brand name. Top teams like CSK and MI get up to ~US$ 10 million and they have long term deals. Notably, Jio was a common sponsor for all 8 teams in 2019 and Kingfisher was the next best to support 4 teams.

3. Ticket Revenue:

Each franchise hosts seven matches in their home stadium. All teams put together earn about US$ 18 – 22 million in a year. Top teams like Mumbai Indians, Chennai Super Kings, and Delhi Capitals earn around US$ 3 – 3.5 million each from the ticket sale. Part of the ticket sale is also shared with the IPL governing council. 

4. Other sources:

Other smaller sources of revenue are merchandising, in-stadia advertisements, etc., the majority of these revenue goes to franchises.

Let’s have a look at how these partnerships affect the bottom line by taking a closer look at the economics of IPL 2019 edition and understanding the split of profits.

IPL 2019 Business Run Rate

IPL has managed to turn BCCI into a superpower in the cricket world. The IPL governing council (BCCI) is sitting with its guaranteed profit, having locked in partners for broadcasting and sponsorship assets owned by them. Let’s “run” the numbers:


IPL receives 50% of the broadcasting revenue ($510 million), 50% of the sponsorship ($100 million), 20% of the ticketing revenue ($20 million), the franchise fees (20% of Franchise revenue – $71 million) and some other smaller revenue sources like royalty on merchandising, etc. 

Major costs incurred by IPL GCs are opening ceremony (costs $5 – 7 million), prize money for winning team and performance-based awards like MVP, purple/orange caps, etc. (costs ~$7 million) and others such as organizing auctions, the salaries for the personnel working for them, and some other administrative costs. This adds to ~$14 million and hence estimated profits numbers are ~$366 millions or $6M+ per match or ~INR 22 lakh per ball bowled.

2. Franchises:

The franchise’s major revenue sources are broadcasting revenue (50%) and IPL sponsorships (50%), team specific sponsorships, ticket sales (80%), merchandising, and in-stadia advertising. Franchises receive the rest of the broadcasting and sponsorship revenue in such a way that some part of it is distributed equally, remaining is performance-based or the prize money. Hence, keeping the prize money aside, the rest is distributed equally. Franchises also earn from player time in TV Commercials and from fan engagement.

The broadcasting revenue and sponsorship allotted to franchises is US$ 305 million (50% of sponsorship + 50% of broadcasting revenue) was distributed amongst the franchisees equally. The average ticket sales earned by a team is US$2.5 million and the average team sponsorship is US$6 million. Average revenue becomes:

Costs incurred by franchises are franchise fees, player and coaches salary, support staff, stadium rent, and administration cost, marketing, living and travel expenses, and cricket associations fee. Franchise fees per year are 20% of the franchise earnings excluding ticket sales. The average player’s cost per franchise is US$ 11.8 million. Stadium rent and management with team travel, accommodation, and management are estimated at around US$ 3 million. Whereas marketing cost is estimated to be US$ 0.85 million.

Overall, a franchise is earning an average profit of about US$ 21.5 million ($46 million – $24.5 million). On top of it, if the franchise wins they earn 50% of the prize money, the rest 50% is given to the players. As the numbers here are average over the teams, some franchises earn more while others less, depending on brand value. Teams like MI, CSK command a premium in sponsorships, but others struggle to get a decent value. But because of whooping broadcasting rights, all teams turned profitable from IPL 2018 – a first since the inception of the league.

3. Broadcasters:

Star paid US$ 510 million a year for the broadcasting rights and earned around US$ 410 million through IPL via advertisements, subscriptions, sub-licensing to other countries and TV distribution. Star had also entered into subscription deals with Bharti Airtel and Reliance Jio Infocomm to offer Hotstar free on the applications of both the companies. To drive subscriptions, Hotstar offers 10 minutes of the match free to the unregistered user, while pushing its yearly subscription plans (Hotstar VIP-$5.5/yr & Premium-$20/yr) immediately after.

Hotstar grew 2x in the year 2019 due to IPL and hosted 300+ million users in March and April 2019. Although Star incurred losses of around US$100 million in 2019, the company is expecting to break even in the coming years with an increase in its advertising and subscription revenues from television broadcasting backed by a rise in viewership.

4. Sponsors:

Title sponsor Vivo paid around US$ 61.7 million for a year, a whopping 554% rise over the previous contract. A lot of branding agencies called this ‘overpriced’ sponsorship. But as they say,  sponsorships have nothing ‘rational’ about them. Customer eyeballs are irrational opportunities and grabbing it for those opportunities is what sponsorship is all about.

Vivo’s market share jumped to 12% from 6% in the first quarter of 2019 and as we speak, it stands at 17%. IPL has definitely helped the company immensely in expanding its consumer reach and creating brand awareness in the country

5. Players:

Every year the eight franchises compete in the IPL auction to draft new players in their squad. Every franchise is capped at 25 players in the squad, with no more than eight foreign nationals. Each franchise is also capped at $12 million in salaries for players. The average player salary in the IPL is US$ 0.5 million (Median $300K). The average number of players in a team is 23-24. Players of a team also earn half of the prize money, if they win the tournament. 

Essentially, IPL is no longer an untested business pitch now. BCCI is earning the insane amount of profits, all the franchises are profitable, Star India has established a virtual monopoly over broadcasting Indian cricket and sponsors are enjoying all-time high screen time with a total consumption of 338 billion minutes in 2019.

Now let’s see how IPL 2020 will be affected due to this pandemic:

Is COVID a bouncer? No, it’s a 6 again!

As the entire world reels under the pain of Covid-19, the IPL money train is running as smoothly as it was in the past. Even though the IPL pool money would decrease because of a decrease in central sponsorship (Title, Associate Partners, Umpire Partner, and Strategic time out Partner) by 30-40%,  it won’t affect the total pool by a lot. IPL pool will still receive $510 million from Star India and $54 million from central sponsors (Dream 11, Cred, Unacademy, Tata Motors). This means IPL GC still receives $282 million from IPL Pool as compared to $305M in 2018. They have also decided to cut costs like scraping the opening ceremony, which would help them save around $5-7 million. Expected revenues this year would be, IPL Pool + Franchise fee (20% of franchise revenue) = $282 million + $64 million = $353 million.

Franchises would be slightly hit, as there won’t be any ticket sales profit, reduced team sponsorships due to the economy hit during the pandemic, etc. They also have to bear extra costs for travel and accommodation for the players to stay in the UAE for the tournament which is estimated at around $1.5 million, which is 50% higher than the regular season. Team sponsorships are down by 15-20% on average. Even after a reduction in revenue and higher cost, franchises are expected to be profitable. Profits of franchise = ⅛ * IPL Pool + Team sponsorships – Franchise fees – Player salary – travel cost = $35.25 million + $5 million – $8 million – $12 million – $1.5 million = ~$19 million.

On top of this, all on-air sponsor packages (revenues to Star) on Star India are completely sold out for the season. Byjus’s will be the biggest spender this year on the on-air advertising (approx 12.5 lakh for 10-second advertisement) and will be spending ~$20 million. But without any doubt, Dream11 will be the most visible brand in IPL 2020 on the back of spendings on both IPL Title Sponsorship and IPL on-air sponsorship with Star India. In terms of viewership, this season might be the biggest ever with more than 500 million viewers.

Be it the UAE or some other country that hosts the matches, be it with or without the in-stadia spectators, this sporting entertainment extravaganza is bound to make money. It is on the back of its ability to have eyeballs glued to screens in abundance on both counts of number and time. The claim becomes stronger looking at the fact that the broadcasting rights revenue alone is enough to float the boat when it comes to recovering all costs.

IPL has all the ingredients to attract the Indian crowd and has become the biggest sports and marketing extravaganza by far for Indians at home and around the world. With 460+ million viewers, IPL has become a go-to event for a high scale brand exposure.

But what helps bring such gigantic ad-dollars? The short answer lies in the adage ‘Content is King’, and this king runs the kingdom called IPL.

This piece is co-contributed by Trishala Bothra and the infographics are designed by Swapnil Panchal

Loved the article?


  1. I loved as much as you’ll receive carried out right here.
    The sketch is tasteful, your authored subject matter stylish.
    nonetheless, you command get got an impatience over that you wish be delivering the following.

    unwell unquestionably come more formerly again since exactly the same nearly very often inside case you shield this hike.

Leave a comment

Your email address will not be published. Required fields are marked *