Cloud over BCCI earnings as search for sponsors continues

Certain brand categories cannot bid, including athleisure and sportswear manufacturers. (Mint)
Certain brand categories cannot bid, including athleisure and sportswear manufacturers. (Mint)

Summary

On 15 June, BCCI invited applications for the Indian team’s jersey rights, setting the base price at a 40% discount from last winning bid

NEW DELHI : The Board of Control for Cricket in India (BCCI) is scrambling to find a new jersey sponsor and title partner after the exit of Byju’s and Mastercard Inc., even as costly advertising, new regulations, and a funding winter combine to depress sentiment.

The world’s richest cricketing body has also yet to start the process to auction media rights for the next cycle of bilateral series played in India and domestic matches after its contract with Disney Star ended in March. The developments may depress BCCI’s earnings and force it to strategize and adapt to the changing landscape, according to experts. “This is going to be a year of correction for BCCI," the head of a leading sports consulting firm said.

“Cricket has become a little expensive to advertise in; everyone’s discussing that. And it also doesn’t help that startups are going through a funding winter and funds have dried up. On the other front, the government has regulated the real-money gaming sector. While this is a bit of a muted sentiment, we must all remember it is a cyclical business," the person said on condition of anonymity.

On 15 June, BCCI invited applications for the Indian team’s jersey rights, setting the base price at a 40% discount from last winning bid. The base price is set at 3 crore for every bilateral match featuring India and 1 crore each for matches played as part of the International Cricket Council (ICC) or the Asian Cricket Council (ACC) tournaments, which include the ICC World Cup and the Asia Cup, respectively.

However, certain brand categories cannot bid, including athleisure and sportswear manufacturers. This is because BCCI has already signed up Adidas as a kit sponsor, giving it exclusive category rights. Alcoholic products, betting companies, cryptocurrency entities, real-money gaming platforms (excluding fantasy sports gaming), tobacco brands, and those associated with offensive content such as pornography are prohibited from bidding.

“They were smart in putting a 40% lower reserve price for the tender since the Oppo deal was done a few years ago. But startup funding is a bit tricky, and BCCI has lowered the base price to be more competitive. Traditional brands such as BFSI companies, etc., which have a commitment towards the sport could make a comeback," a top executive at another sports talent management said.

The economic climate in the country and how much cricket is now available throughout the year, including BCCI’s Indian Premier League (IPL) as well as other T20 tournaments, should also be kept in mind, the person said, adding the environment has become far more competitive now.

BCCI had to look for a new jersey sponsor after Byju’s ended its $35 million deal as part of its efforts to reduce costs. The edtech giant was paying 5.07 crore per match for domestic matches featuring India team and 1.56 crore per match for ICC and ACC tournaments. Oppo was paying 4.61 crore per match. In 2013 too, there was a decline in rates when Star India paid 1.92 crore per match organized by the board, as compared to Sahara, which had bid 2.35 crore for every BCCI match.

Jersey values have plunged over the last decade. Nike was paying BCCI about 88 lakh per match till 2020 for a total of about 370 crore in a deal that lasted 14 years. In this, it also paid an annual fee of 6 crore and 15% royalties on sales, adding up to 10 crore per year.

In February, Mint reported BCCI was close to signing German sporting goods multinational Adidas as the kit sponsor for the Indian cricket team for 350 crore, which was announced in May.

Adidas replaced Kewal Kiran Clothing Ltd, maker of Killer Jeans, which came in as interim sponsor last month after the then-sponsor Mobile Premier League Sports (MPL Sports) pulled out of its deal midway. Adidas’s five-year term was to start this June and run till March 2028. The company is said to be paying 65 lakh for every match that India plays. Including royalty for merchandise, the annual outlay is around 70 crore.

On the title sponsor, in September, Mastercard took over from Paytm (One97 Communications Ltd), which had signed a deal with the board for 326.80 crore in 2019. Paytm was to fork out 3.8 crore per match, about 58% higher than the earlier 2.4 crore deal, but in July 2022, the company requested BCCI to assign the rights to Mastercard till March 2023.

The payment-processing firm has not renewed the deal with BCCI yet. The board is yet to start a process to find a replacement as the next bilateral series in India is in September, while it is also waiting for the merger of Zee Entertainment Enterprises Ltd and Sony Pictures Networks India before coming up with the tender to auction the media rights.

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