How Cricket Lovers Make Money By Investing in CSK Unlisted Shares

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9th Sep, 2022

Chennai Super Kings (CSK) is basically a franchise cricket team based in ChennaiTamil Nadu, India where they play in the Indian Premier League (IPL). Chennai Super Kings (CSK) was founded in 2008 and it later on acquired the Chennai Franchise of BCCI-IPL on 20th February, 2015 respectively. The home matches of the team are played at M. A. Chidambaram Stadium in Chennai which is owned by Chennai Super Kings Cricket Ltd and India Cements is the major stakeholder of Chennai Super Kings (CSK). The higher authority and the directors of Chennai Super Kings Cricket Limited are Sabaretnam Lakshmanan, Subramanian Palaniappan, Srinivasan Ranganathan, Kalyanasundaram Balasubramanyam, Rakesh Singh, Ramgopal Kalathingal and Karukayil George John.

After serving a two-year ban from the IPL that actually began in July 2015 for the alleged association of their owners in 2013, the Super Kings returned to the league in 2018 thereby winning the championship in the comeback season. This marked its third win overall following a win in 2010 and 2011 to join Mumbai Indians for the record of maximum IPL title wins that created history in the present era.

The captain of the team is Mahendra Singh Dhoni who guided the team to three victories since 2008 and is trained by Stephen Fleming. The Chennai Super Kings have the best winning rate amongst all teams in the IPL. Chennai Super Kings contain the records of most occurrences in the IPL playoffs and have played the playoffs in each season. Additionally, stating, CSK also qualified to eight finals out of the ten leagues that they took part in which in a stake made them one of the most flourishing and successful franchises in the IPL of the cricket team.

Besides that, CSK have further won the Champions League Twenty20 in 2010 and 2014 respectively. The title value of the Chennai Super Kings in 2019 was estimated at around 732 crores making them one of the worthiest franchises in the IPL. The team of CSK is sponsored by Muthoot Group, Gulf oil, Equites small finance bank, India cement, HIL, Nippon paint, Atria convergence technologies and Parle Agro Frooti.

Talking about the brand value of CSK, it could be analysed that Chennai Super Kings value in 2018 was estimated at around $65 million as per the Brand Finance Report that made it the most valuable franchise of the entire IPL team. Revenue of Chennai Super Kings (CSK) is earned from various sources as follows:

  1. Share of IPL tournament broadcasting rights (collected by BCCI and shared with teams)
  2. Brand sponsorships
  3. Tournament related income like match fee, prize money and selling team merchandise
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Due to and after the spread of COVID 19 pandemic and in order to control the pandemic, the Board of Control for Cricket in India (BCCI) conducted the IPL season XIII at UAE during September – November 2020. BCCI, on account of spread of COVID 19 pandemic, decided to suspend the remaining matches and the same were rescheduled to be held at UAE from 19th September 2021.

There was a major drop in total revenue and profits of CSK for the year 2020-21 as compared with the previous year. It was mainly due to reduced revenues on account of COVID 19 pandemic. In order to conserve the resources, the Company did not declare any Dividend for the year ended 31st March 2021. The Company also has not transferred any amount to the reserves for the year ended 31st March 2021. 

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Chennai Super Kings (CSK) emerged as the biggest sports franchise in India, according to a survey conducted by media consulting firm Ormax Media.

Talking about the Unlisted shares of Indian Premier League (IPL) franchise Chennai Super Kings (CSK), it could be said that CSK has pushed up its price 25 percent year-on-year (YoY) to Rs 200-205 per share as compared to Rs 160-165 per share in 2021. CSK’s valuation has now reached around Rs 6,300 crore.

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Chennai Super Kings (CSK) attracted investors due to the growing revenue from sponsorships, royalties and merchandise. Another reason for the upswing is demand of CSK was seen for the newly inducted Gujarat and Lucknow franchises that were bought for way higher than the base price of Rs 2,000 crore each for a steep Rs 5,625 crore and Rs 7,000 crore. CSK is estimated to have 308 million unlisted shares of which 5-7 percent is traded on a regular basis leading to the more secondary market transactions. 

Chennai Super Kings (CSK) also has the highest win percentage in the IPL at 59.83 percent and has won four tournament titles in 2010, 2011, 2018 and 2021. The team of CSK holds the record for most appearances during the IPL playoffs (top 11) and finals (top 9). Kotak Mahindra AMC had earlier this month invited bids for one lakh CSK shares which will be valid for 30 days from the February 14 bid closure date. The AMC landed the CSK shares when it was demerged from India Cements and decided to explore the bidding route to offload the shares as the franchise is still unlisted.

Chennai Super Kings market cap has crossed a high of Rs. 7,600 crores, more than India Cements’ market cap, and its unlisted shares are trading in the INR 210 – 225 price band. Chennai Super Kings reported a profit of Rs 40.26 crore for the year ended March 2021, down from Rs 50.33 crore in 2019-20. It reported a revenue of Rs 253.69 crore for the year ended March 2021, down from Rs 356.53 crore in the preceding year. CSK was carved out of India Cements, which is the shareholder and trustee of the franchise, in 2015. This was done after the match-fixing scandal that year which led to CSK being banned from participating in the subsequent IPL edition. In Financial Year 2020, India Cements held over 30 percent stake in CSK. The unlisted shares were released in 2018 amid the corruption and betting charges placed against it.

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Chennai Super Kings Year-on-Year (YoY) Growth

 

Year

Compounded Sales Growth

Compounded Profit Growth

Return on Equity

1 year

-28.84%

-20.02%

20.54%

2 year

-22.08%

-39.83%

33.41%

3 year

296.34%

NA

159.06%

Tell us in the comments section below whether you would like to invest in Chennai Super Kings unlisted shares.

 

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