May 11, 2021

Sports Legend

BCCI expected to suffer losses of over Rs 2000 crore due to postponement of IPL forced by COVID


BCCI stands to lose over Rs 2,000 crore of the broadcast and sponsorship money allocated to this year’s Indian Premier League, which was postponed indefinitely on Tuesday due to COVID-19 cases in its bio-bubble .

BCCI was forced to postpone the IPL after several cases of COVID-19 among players and support staff emerged from Ahmedabad and New Delhi in the past two days.

“We would lose anything between Rs 2000 and Rs 2500 crore for the postponement midway through this season. I would say something in the order of Rs 2200 crore will be closer to an accurate estimate,” said a senior BCCI official on condition of anonymity.

The 52-day, 60-game tournament is said to have ended in Ahmedabad on May 30. However, only 24 days of cricket were possible with 29 matches completed before the virus interrupted proceedings.

The biggest loss for BCCI is the money it receives from Star Sports for the broadcast rights to the tournament.

Star has a five-year contract worth Rs 16,347 crore, or Rs 3,269.4 crore per year. If there are 60 games in a season, the valuation per game is around Rs 54.5 crore.

If Star pays per match, the amount for 29 matches would be approximately Rs 1,580 crore over what would have been Rs 3,270 crore for a full tournament. This means a loss of Rs 1690 crore for the card.

Likewise, VIVO mobile makers, as title sponsors of the tournament, pay Rs 440 crore per season and BCCI is likely to receive less than half of that amount due to the postponement.

Add to that, partner companies like Unacademy, Dream11, CRed, Upstox and

, which pay in the range of Rs 120 crore each. Some subsidiary sponsors are also present.

“Cut all payments in half or a little less and you will hit a loss of around 2,200 crore. The actual losses could be much larger, but that’s a substantive calculation for the season,” the official said. .

The loss of a substantial sum of money will also cut the central revenue pool for the season to almost half (the money that BCCI distributes among eight franchises).

The official, however, did not disclose how much each franchise would lose due to the tournament suspension.

“It’s hard to say what kind of sponsorship and co-sponsorship they’ve won this season because the economic climate has been quite hostile,” he said.

Player payout would be based on duration rather than pro rata

.

In the event that players are only available for part of the tournament, salaries are paid on a pro rata basis, which means “awarding an amount to a person based on their share of the whole”.

However, a senior player said the pro-rata only applies when a player voluntarily makes himself available for only part of the tournament based on available matches.

In this case, the organizers have interrupted the event so that the franchises are likely to pay at least half of the season.