Mallay’s Royal challenger will be red in First year.

March 31, 2008

Bangaluru: Yes it true, the Mallay’s Royal challengers will be Red for the first year not only in their costumes but also in their profitability. The chief executive of the flamboyant Mallay’s Royal challengers said that during the first year of operation, they are going to have net loss of approximately 25-35 corers. The Vijay Mally’s UB group won the Bangalore franchise for whooping $111.6 Million is expecting to reach its breakeven in next 6-7 years. But this is a mere prediction. No one knows actually when breakeven is going to be achieved for most of the IPL franchise.

The reality is very different from what people are generally thinking about the IPL (Indian premier League) franchise. In fact this is a very expensive league. The expert believes that if the sponsorship and the merchandising for the teams pick up, then there are chances that break even could be achieved in the stipulated time. But this is quite unrealistic projection considering current trends.

The main point to worry about these franchises is not only finding sponsors but also they have to fight with the unpredictable BCCI. As recently the percentage of stadium seats available with the franchise has been amended. Now the franchise has only 80% of the seats available with them and the rest 20% has been given to the respective state associations. And more over the sharing of seats category is also not clear. But the Charu shama, chief executive of Royal challengers said that we will look at this sharing formula very seriously because the category wise distribution of seats across the stadiums in India is not uniform. And this can affect our revenue up to a great extent.

Posted by Dheeruyadav  


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