MUMBAI, (Reuters Breakingviews) - The golden batting pads used by some Indian Premier League players reflect the league’s rich financial reality. All eight top-tier teams competing in the seven-week tournament that wraps up on Sunday are turning a profit. That makes it easy for tycoons Mukesh Ambani and Saijan Jindal to justify owning such typically trophy assets through their flagship conglomerates.

A division of Jindal’s JSW Group has shone a light on corporate ownership. His heir apparent, Parth, revealed in March that the steel-to-infrastructure group holds a right of first refusal to buy the other half of the Delhi Capitals. Based on its 2018 acquisition price, the team is worth about $160 million. Ambani, meanwhile, owns the Mumbai Indians by way of Reliance Industries. Royal Challengers Bangalore belongs to United Spirits, whose parent is the booze titan Diageo.

One reason sports clubs have traditionally been owned personally by billionaires was because of the losses involved. Walt Disney, for example, offloaded the National Hockey League’s unprofitable Mighty Ducks (now just the Ducks) in 2005. Rupert Murdoch’s Fox empire sold the Los Angeles Dodgers baseball club for similar reasons. Nearly one-third of National Basketball Association teams lost money even after revenue sharing, sports network ESPN reported in 2017.

While the explosive income from broadcasting rights has improved fortunes for some U.S. sports, India’s clean sweep in cricket is impressive. Blockbuster TV revenue has made the difference here, too. StarTV, recently bought by Disney as part of the bigger Fox deal, paid $2.3 billion for five years of cricket rights through 2022. The teams share about 40 percent of the pot, on average giving each about $23 million a year, before income from ticket sales and hospitality, sources say. That easily covers costs, dominated by player salaries that max out at about $12 million for each team.

There’s room for growth, too. Viewership for this season’s opening weekend was up 31 percent, to 219 million, from last year. League insiders expect the value of broadcast rights will increase by at least 50 percent in the next auction. The tournament also could easily add more teams or extend its duration by another four weeks. Such possibilities make these trophies sit nicely in India’s corporate display cases.

CONTEXT NEWS

- The twelfth season of the Indian Premier League runs from March 23 to May 12.

(Editing by Jeffrey Goldfarb and Sharon Lam)

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