IF it was Chennai Super Kings (CSK) and Rajasthan Royals (RR) approaching their day of reckoning with dread at the start of the week, the anxiety pangs have shifted to the other six IPL franchises as they look forward to Sunday, when the Governing Council (GC) reveals the ramifications of the Lodha committee judgment.
And one of the key issues that they are looking forward to is whether MS Dhoni will end up going under the hammer for the first-time ever. That would depend, however, on whether the GC decides to replace the suspended franchises by auctioning for two new teams, and thus leaving not just Dhoni but a number of star-studded players from both CSK and RR up for grabs in the 2016 IPL players auction.
The other likely option before the GC is replacing CSK and RR with two new franchises, who will retain the present roster, like they did with Deccan Chargers-who were replaced by Sunrisers-which would mean no untoward worries for the six franchises who will show up for IPL 9 in the same form and shape as they did in the previous season. But if the names of Dhoni and Smith among others were to go up for auction, it could cause bedlam.
“It is a very tricky situation for all the other franchises. Because you will be tempted to put a lot of your players into the auction next year, go in with Rs 45-50 crore and try to get a Dhoni, Raina, Steve Smith or Ajinkya Rahane. So all the franchises are waiting with bated breath,” said a senior official from a franchise.
A member of the team management of another franchise, meanwhile, felt that till the time the BCCI or the GC ensured that the league remained an eight-team tournament there would be no qualms among the half-a-dozen franchises who stand unaffected as of now by the Lodha committee verdict.
“Then status quo remains. There is no financial implication on us. The broadcast contract is locked in with eight teams, which guarantees a fixed number of matches. The problem arises if they somehow continue with only six teams, which is unlikely,” he said.
So what happens then when CSK and RR are eligible to participate in the IPL again, in the 2018 IPL? Some believe that it could leave the two beleaguered franchises in even worse shape, as they might have to depend on nothing more than a residual bunch of players to make up their teams, having already given up the cream of their class.
“If these players get into the auction, two new teams will come in with Rs 56 crore as their purse. They will go buy MS Dhoni or Raina, Jadeja or Ashwin. The new teams, whoever buys Dhoni & Co will want to retain them before the 2017 auction. And then in 2017 all eight prevailing teams will have signed up players on two-year contracts. So when CSK and RR come back into the IPL in 2018, where will they get players from?” asks the team official.
Another source who has been part of an IPL-winning franchise, however, is of the opinion that not participating in the IPL is unlikely to have a significant financial bearing on CSK and RR.
“If you don’t play, then the impact on your balance sheet is zero. But if you don’t play your impact on sponsorship is 100, because your sponsorship value is zero,” he explains.
“Not playing in the IPL means they don’t have to players or coaching staff. Most franchises project their merchandise value for not more than Rs 1-1.5 crore. So that loss is negligible,” says another franchise official.
Not every franchise is on the same page, however, when it comes to revealing whether their forays in the IPL have all been loss-making ventures.
“There are enough wealthy people in India who do not mind losing a few crores. And as far as I know CSK have always claimed to make no profit. If they play they lose money. If they don’t play they don’t lose money,” says one team director.
But another official from a northern franchise is quick to refute those claims, insisting that most teams started breaking even from the third or fourth year onwards.
“If you are in the top-4, your television revenue is around 62-63 crore. The top team might even get 70+ crore. Advertisement revenue is around 40-42 crore.
This itself will cover your player expense and your franchise fee. And then your local ticket revenue is around Rs 30 crore,” he says.
“This year onwards, if you are a champion or a runner-up or third place, 70 per cent of the prize money goes to the players, and 30 per cent goes to the franchise. And IPL is compensating 70 per cent what you paid to the players to the franchise. So you get 100 per cent prize money in your kitty,” he adds.
Then there have been those in the IPL fraternity who have perennially expressed fears of the T20 league’s stocks dwindling to the extent that many teams are feared to be desperate about selling their stakes, which according to them is becoming increasingly difficult in the post spot-fixing scandal era.
“The valuation of IPL in 2010 was one rung below the FIFA World Cup. What is the value now? It was 6 billion then. It has dropped to 1 million now. Stakeholders are trying to sell 25 per cent of the stake and sit on the money till they get a controlling stake. But that is not happening today,” says an official.
There are some who remain as optimistic as ever, and refuse to see the IPL scene in any other colour but pink, and insist, “In my opinion from 2010 to 2014 the stocks have risen. In 2013, Pepsi became a sponsor at a higher valuation. The Sony deal in 2015 is higher than in 2010. I can see the curve go upwards. If ever, this would be the time to buy an IPL team not sell one.”
But the fear that the BCCI might pull a rabbit out of the hat at their expense is very much a mutual concern among the six prevailing franchises.
“If this was any other team, the BCCI would have suspended them right after the 2013 IPL. Here the cheat and the judge is the same person.
In 2011, they violated the franchise agreement, which they have done repeatedly over the years, by introducing a retention policy just so that CSK keep Dhoni,” says one team official.
He’s also quick to express his dismay at suggestions that the BCCI might take over the franchises and run them as their own for the next two years. But he doesn’t put it past them.
He says, “See, they call us IPL team owners. But if anything we are just glorified paying guests. We have no say. All we can do is wait till Sunday and as always be told how life’s going to be from here on.”