Chennai Super Kings Unlisted Shares
A> Overview of Chennai Super Kings
The Chennai Super Kings (CSK) is a franchise cricket team based in Chennai, Tamilnadu which plays in the Indian Premier League (IPL).
Founded in 2008, the team plays its home matches at the M.A Chidambaram in Chennai. After serving a two-year suspension from the IPL starting July 2015 for the alleged involvement of their owners in the 2013 IPL betting case the Chennai Super Kings returned to the league in 2018, winning the championship in the comeback season, its third overall to tie Mumbai Indian for the record for most IPL title wins. The team is captained by Mahendra Singh Dhoni.
The brand value of the Super Kings in 2018 was estimated at $65 million, making them the most valuable franchise in the IPL as per Brand Finance Report.
One of the major boosts for IPL this year, as per the Brand Finance report, was not just television viewership which grew by 11%, but also the fact that over 200 million people watched the tournament on digital platforms such as Hotstar. “Cricket enthusiasts who did not get tickets to see the games live could watch the competition in specially designated Fan Parks in 36 cities across the country. Family-friendly and free to attend for all, Fan Parks offered music, entertainment, and a range of merchandise stalls, bringing stadium atmosphere to city centers on a scale larger than ever,” points out the Brand Finance report.
B> Demerger from India Cement
The India Cement on 26.09.2014 approved a demerger of Chennai Super Kings a BCCI-IPL Franchise 20/20 Cricket Tournament Team into a wholly-owned subsidiary by transferring its net assets at cost. So with effect from 01.01.2015, a new wholly- owned subsidiary will get incorporated. The shareholders of CSK will get one share of CSK for every one share of India Cement.
India Cements had transferred its holding of CSK to India Cements Shareholders Trust with October 9, 2015, as the date fixed for allotment of the shares. The shareholders of the company were allotted a share each for every India Cements shares they owned. However, since that time period, CSK, along with Rajasthan Royals had to serve a two-year suspension due to respective team principals Gurunath Meiyappan and Raj Kundra found to being involved in the suspicious betting activity.
The company has paid-up capital of 3.1 Cr at FV of 10 paise. The current valuation of the Chennai Super Kings is 450 Cr.
Chennai Super Kings Unlisted Shares Details:
| Total Available Shares: | 1000 |
| Face Value: | ₹ 0.1 Per Equity Share |
| Lot Size: | 500 Shares |
| Current Unlisted Share Price: | ₹ 25 Per Equity Share |
The way Cricket is loved in India, I think one should definitely look to pounce on Chennai Super King Shares available at a good valuation. The craze of IPL is getting bigger and bigger as the league is getting old. The way Delhi Daredevils have performed in terms of Revenue this season the future of the sports league is looking very bright. The Revenue was almost tripled in the first 6 months of the year as compared to last year.
Source of Income of IPL Franchise
1. Central Right
2. Sponsorship Fees
3. Sale of Tickets
4. Coaching fees.
Delhi Daredevil FY Performance:
2014-15
Revenue= 117 Cr
PAT= -20 Cr
EPS= -210
2015-16
Revenue= 137 Cr
PAT= -6.1 Cr
EPS= -68
2016-17
Revenue= 132 Cr
PAT= -9 Cr
EPS= -96.93
2017-18
Revenue= 136 Cr
PAT= 1.9 Cr
EPS= 19.88
6MFY18-19
Revenue= 316 Cr
PAT= 69 Cr
EPS= 605
On May 2018, the JSW Group has bought 50% Stakes in Delhi Daredevils wherein they have bought close to 5,87,588 number of shares at Rs. 550 Cr. The Value of one share 9360. With an EPS of 605, the P/E of Delhi Daredevils is 15.47.
The Delhi Daredevils valued at 1100 Cr during a deal Kings,W Group in May 2018.
Please note that Face Value of Chennai Super Kings Cricket Ltd is Re 0.10 (10 paise) and not Rs. 10
Interesting parallels can be drawn from Delhi Daredevils now Delhi Capitals on the value and earning visibility. They have published 3 years annual accounts and half yearly statements for period ending Sept 30th 2018.
The financial statement of this IPL team can give some visibility on how the earnings are made and what would be the likely valuations given the fact that Chennai Super Kings is much better team compared to all other teams in the IPL, in my view it should enjoy better valuations. This is my personal view.
Thanks for the view. I will take Delhi Daredevils as a peer company to do a comparison.
1. Many investors who got CSK shares last month were seen selling them off-market. Savvy investors are interested in buying CSK share.
2. There is a good demand for CSK shares in off-market as it’s currently trading at a discount to its brand as per market experts.
3. According to an Economic Times report, investors are lapping up shares the CSK-ownership entity Chennai Super Kings Cricket in off-market transactions.