Speculation is mounting regarding the potential sale of the Royal Challengers Bangalore (RCB) Indian Premier League (IPL) franchise, with Serum Institute CEO Adar Poonawalla seemingly adding fuel to the fire through a recent social media post. The buzz began after former IPL commissioner Lalit Modi suggested that the current owners, United Spirits Limited (USL), a subsidiary of Diageo, might be looking to sell the team.
Poonawalla's interest appears to have been piqued, as he posted on X, "At the right valuation, @RCBTweets is a great team". This statement is being widely interpreted as a hint that he is considering acquiring a stake in the franchise.
Reports indicate that USL is seeking a valuation of around $2 billion (approximately ₹17,762 crore) for RCB. While this is a hefty price tag, Lalit Modi believes that RCB, particularly after their recent IPL win under Rajat Patidar, represents a prime investment opportunity, potentially attracting interest from global or sovereign funds.
Citi, a global investment bank, has reportedly been appointed as the transaction advisor for the potential sale.
The possible sale of RCB comes on the heels of a majority stake sale in another IPL team, Gujarat Titans, where Torrent Group acquired a 67% stake. This further underscores the growing financial interest and value associated with IPL franchises.
While the news and rumors continue to swirl, United Spirits has declined to comment on market speculation. A spokesperson stated that the company does not respond to such rumors. Similarly, Diageo has also refrained from commenting on the matter.
Analysts suggest that if the sale of RCB goes through, it would further solidify the IPL's position as one of the fastest-growing and most valuable sporting leagues in the world. Despite the ongoing speculation, brokers continue to recommend United Spirits as a strong investment. JM Financial, for example, has initiated coverage with an 'add' rating and a target price of Rs 1,475, citing strong revenue growth, EBITDA, and PAT, with expected pre-tax RoEs and RoCEs of 20% and 28% respectively between FY25 and FY28.
It's important to note that while Adar Poonawalla's interest seems apparent, no concrete deal has been confirmed. The valuation of $2 billion is considered high, and discussions are likely ongoing. The coming weeks could reveal whether Poonawalla, or another party, will ultimately acquire a stake in the Royal Challengers Bangalore.
