New Delhi: The Buddh International Circuit is set to host India’s first Formula 1 car race on 30 October, having cleared several hurdles along the way. Sameer Gaur, managing director and chief executive of Jaypee Sports International Ltd, which built the 120,000-capacity circuit, expects a full house.
The circuit is, however, still to get a final approval from the Fédération Internationale de l’Automobile (FIA), the governing body for the racing event. FIA will inspect the track on 1 September.
Maximum mileage: Gaur says the race track will also be available for other events, such as MotoGP and the Superbike World Championship. Photograph by Pradeep Gaur/Mint
In an interview, Gaur said that after the race, the track will be open to other international sporting events, including possibly the MotoGP, a motorcycle racing championship, by the end of next year. He expects the company to break even by 2014. Edited excerpts:
You will be paying a licence fee to FIA, which I presume will be huge. With the kind of investment you have put in, is break-even a concern for you?
We have been talking to them (FIA). If we are holding an event we will have to pay licence fee to them. These are big businesses in which it takes time for profits. We have put in $400 million so far; 30% is equity and 70% debt. We aim to break even by 2014.
Does F1 in India make economic sense? The Australian Grand Prix has raised some serious questions on the economic aspect of hosting F1 races.
I think what is most important for us to understand at this point of time is that India does not have, apart from cricket and IPL (Indian Premier League, a short-format cricket league), an event to look up to. So hosting a Formula 1 will give people an opportunity to explore other things. So yes, opportunities are there. Apart from F1, we are looking to hold other racing events. When we talk about the track, it will not be available for just F1. The track will be available to us for 300 days and we can definitely do a lot more. But there are a host of other things such as sponsorships and other things where one can negotiate better. In 2012 alone, we will be hosting two-three international racing events. The MotoGP and Superbike (World) Championship have shown interest, but the first priority for now is F1. We are in initial stages of talks with MotoGP and we aim to hold this in 2012. So, a model is being designed.
How will this track be different from other tracks?
The first difference is that it is in India. In the Buddh International Circuit, we have built four corners with 18-20m width where four-five cars can run abreast and overtake each other. It is a very fast track with average speed of 240km/hr, with the maximum going up to 320km/hr. Apart from that, it is the only track in the world where three corners have been built with FIA’s new guidelines.
How big an impact will this Grand Prix have on motor sports across the country?
I think huge. Till now there was no infrastructure like this in India and anything starts when an infrastructure is made and when big groups and companies get into these things. I think a lot of opportunities can come up in the next one-two years. The outcome can be huge.
Do you intend to take the merchandising route to boost revenue?
We are talking with Puma for the official merchandise partner. We should finalize the deal shortly. But selling merchandise is not our focus. It will have to do more with making (the) circuit more popular. Only once the circuit is popular then we will look at selling merchandise in and around the circuit.
What kind of response are you getting from the foreign audience?
A lot of people have been enquiring about tickets and I think around 10,000 tourists are supposed to come to India for this event. Around 6,000 hotel rooms have been booked across the city for the event. We have sold over 10,000 tickets so far. We expect a full house and a ticket revenue of around Rs 75 crore.
How will locals benefit?
It all depends on the investment scenario in a particular region. The investment scenario in Gurgaon really picked up after Maruti went there and then entire Gurgaon changed. I think investment opportunities in that region is picking up to some extent.
We are making the Yamuna expressway, which is the 165km-long road connecting Noida to Agra. That is going to open an entire spectrum of traffic and the track is adjacent to that, and I definitely feel that other businesses are going to open up.
Rudraneil Sengupta contributed to this interview.