CSK back on investor radar as shares rise | Economic Times

Mumbai: Indian Premier League franchise Chennai Super Kings (CSK) is said to be making a comeback to the investor radar, even as the 14th edition of the cricket league is underway despite the pandemic.CSK’s unlisted shares are trading at Rs 75-80 apiece in the unofficial market, marginally lower than about a month ago but still higher than the Rs 45-55 levels they had dropped in June last year.The impact of the pandemic on sporting events in 2020 had led research firm Duff & Phelps to lower the brand value of CSK.The team was spun off into a separate entity from India Cements about five years ago, after it got embroiled in a match-fixing scandal. 82190142India Cements Shareholders Trust and Trustees reportedly held a more than 30% stake in Chennai Super Kings Cricket Ltd in the financial year 2020.“CSK is the only sports team in India whose shares are available for public investment,” said Vaishali Dhankani, founder of Analah Capital. “CSK draws maximum viewership and has been the most successful IPL team,” she said, adding that its valuation was bound to increase when the Covid situation improves.CSK’s brand value dropped by 16.5% to Rs 611 crore in 2020, said a Duff & Phelps report.The team has won 106 matches out of 180 played in the IPL till last year, show a market estimate by Analah Capital. CSK has participated in 11 out of the 13 IPL seasons and won the trophy for three times, and were the first runner-up five times.Its unlisted stock is estimated to have a market capitalisation of about Rs 2,500 crore.“CSK has gone through a topsy-turvy trajectory in the past six years," said Sunil Chandak of Gennext Investrade, a Mumbai-based firm dealing in unlisted stocks. "It is now set to grow with its capital expenditure plan beginning to yield results.”“The company appears to have shrugged off all past baggage to resume a new run in the sports arena," he said.During the time of the demerger, shareholders were supposed to receive one CSK share free against each India Cement share they held. That delivery was stuck amid the corruption and betting charges on the team. The shares were released in 2018, triggering trading in the unlisted stock market.Billionaire investor and founder of D’Mart Radhakishan Damani is said to have increased his stake in CSK from time to time.Also, the IPL, a premium sport activity in India, may soon receive another booster dose with a ninth team likely coming up for auction in June this year, which may lead to a re-rating of the valuations, dealers said.CSK’s sources of earnings include contributions from the central IPL pool for selling media rights to broadcasters, money from title sponsors, licensing to co-sponsors and revenue from gate fees as well as stadium advertising.