Investors chase Indian Premier League to ride booming cricket economy

Indian cricket is increasingly becoming hot property for investors looking to cash in on the booming business of the wildly popular sport in the subcontinent.

In little over a month, the Indian Premier League, or IPL, has seen two of its franchises being sold to investors at billion-dollar-plus valuations, the latest being the Rajasthan Royals that was bought this Sunday, valued at $1.65 billion.

A consortium of U.S. investors led by Kal Somani and backed by Rob Walton of Walmart Group was in the fray to acquire Rajasthan Royals, according to multiple media reports, but lost out to global steel magnate Laxmi Mittal and Indian vaccine tycoon Adar Poonawalla.

Somani’s group expressed disappointment at not being able to own the franchise, according to ESPN. “We were all motivated by the opportunity to help take the IPL to new international heights,” the consortium reportedly said.

In late March, a group comprising Blackstone and serial American sports investor David Blitzer acquired IPL’s Royal Challengers Bengaluru, or RCB, franchise in a $1.8 billion deal.

IPL is a fast‑paced, franchise‑based cricket league launched in 2008 that blends top international and Indian talent. Played each year over nearly two months, it features 10 teams, offering a mix of high‑intensity cricket, celebrity ownership, entertainment, and massive TV and streaming audiences.

Besides cash flows and valuations, investor returns have also been quite stellar. “Compared with global deal benchmarks, IPL returns stand out for their speed and growth profile,” Walton said, estimating that private equity firm CVC Capital earned 350% return last year when it sold its 67% stake in IPL franchise Gujarat Titans. CVC had acquired Gujarat Titans in 2021.

Take the case of RCB, a franchise that has a huge fan base despite it winning the league only once since its inception.

RCB returned 37 times the invested capital after being sold for 166 billion rupees in March. Indian businessman Vijay Mallya, the former owner of United Spirits, recently disclosed he bought RCB for 4.5 billion rupees. In 2013, when Diageo acquired United Spirits, RCB’s ownership was transferred to the liquor maker.

“[IPL] Franchise valuations have multiplied several times over the past decade, with returns that are competing with top US leagues,” said Gareth Berlee, director at Singapore-based Mason Rae Capital, which specializes in fundraising for sports assets.

Compared to the NBA and the English Premier League, India’s cricket league is at an early stage of maturity, so while the absolute value is lower, the growth trajectory will be steep, experts said.

“In my opinion, investors are buying into what US assets looked like 12-15 years ago, but this time with a much larger population and digital audience upside,” Berlee said in an email response to CNBC.

The next phase of growth will be globalization of leagues, deeper monetization of digital audiences, and commercial expansion beyond matchday revenues, he said. Some of it is already underway.

As per market research firm Nielsen, more than 66% of people in India are cricket fans — about 950 million. That offers enormous growth potential as rising disposable incomes drive spending on tickets and merchandise, experts told CNBC.

Fans are buying tickets at price points that would have been “unthinkable a few years ago,” said Amitesh Shah, founder of sports management firm LegaXy, adding that engagement of fans with the sport “does not stop when the last ball is bowled.”

They are spending on merchandise, subscribing to platforms specifically to follow their teams, and engaging with brand campaigns in ways that end up in purchases, Shah said.

IPL teams are now full-fledged sports and entertainment franchises.

The IPL 2025 season was watched by more than 1 billion people across television channels and digital platforms and led to 3.83 billion interactions across social media. About 44% of those viewing also engaged with a free-to-play, live quiz game during match time.

There could be no better example of the pull these franchises have among the local and Indian diaspora fan base than the Mittal family, whose roots are in the state of Rajasthan.

“I love cricket, and my family is from Rajasthan, so there is no IPL team that I would rather be part of than the Rajasthan Royals,” Mittal said in a statement announcing the acquisition.

From a buyer’s perspective, IPL ticks all the right boxes and is the only profitable bet that investors can take on Indian sports as of now, experts said.

It has a colossal and growing fanbase, earnings are predictable as revenues from media rights come through before the start of the season, and there are few external risks, said Karan Kalra, managing partner at law firm Bombay Law Chambers.