CSK shares jump 2x in a year, still trade at 30% discount to RCB, RR valuations

As the new edition of the Indian Premier League (IPL) inches closer, two franchises—Royal Challengers Bengaluru (RCB) and Rajasthan Royals (RR)—have gone under the hammer, selling for Rs 16,600 crore and Rs 15,300 crore, respectively. Despite the staggering sale of the Jaipur- and Bengaluru-based franchises, one IPL team is still trading at nearly a 30 per cent discount in the pre-IPO market.

Unlisted shares of Chennai Super Kings (CSK) have nearly doubled in the pre-IPO market in the last one year, rising to Rs 310–320 levels from the Rs 160–170 mark a year ago. Despite this jaw-dropping rise, the total market capitalisation of CSK stands around Rs 11,500–12,000 crore, a steep discount compared to its peers that were recently sold.

The RCB and RR deal sets a new benchmark for IPL franchise valuation, implying more than a two-times valuation for Gujarat Titans, which were sold four years ago, noted Nuvama Institutional Equities. “This reflects a sharp re-rating of IPL assets, with franchise value surging 25 times since inception in 2008, supported by strong global investor interest from private equity firms and US sports owners,” it said.

To recall, Chennai Super Kings was demerged from India Cements Ltd in 2018 when the team was banned for two years in connection with spot-fixing allegations. Investors of India Cements received shares of CSK in a 1:1 ratio, and the stock began trading at Rs 10–12 initially. The stock has jumped as much as 30 times over the last eight years.

Sandip Ginodia, CEO of Kolkata-based Altius Investech, believes that CSK should command a valuation at par with its peers. Sports leagues across the globe trade at premium valuations, and it is time for cricket franchises to follow suit, considering the eyeballs they attract from the Indian subcontinent.

CSK reported total revenue of Rs 644 crore, with an operating profit of Rs 252.10 crore and a net profit of Rs 180.94 crore for the year ended March 31, 2025. The company’s board also announced a dividend of 1,000 per cent, or Re 1 per share (face value of Rs 0.10 apiece), for the financial year.

It has three subsidiaries—Superking Ventures, Joburg Super Kings and Super Kings International—with the latter two operating in SA20 and Major League Cricket (USA). However, these remain loss-making ventures for the company so far. Ace investor Radhakishan Damani and LIC of India cumulatively own nearly a 6 per cent stake in CSK.

However, some dealers in the unlisted space believe that CSK should command a premium valuation over its peers like RCB. Hitesh Dharawat, co-founder of Dharawat Securities, said that CSK is a more successful franchise with stronger brand value than both its peers. CSK is also the most popular team.

Echoing a similar view, Piyush Jhunjhunwala, founder and CEO of Stockify, said that Chennai Super Kings should command a 5–10 per cent premium over RCB, resulting in a fair valuation close to Rs 18,000 crore for CSK, considering its strong brand value, legacy and success in the biggest T20 league globally.

At a Rs 18,000 crore valuation, CSK’s ideal stock price comes out to be around Rs 475 apiece, suggesting nearly a 50 per cent upside from current levels. Jhunjhunwala believes that CSK’s fair valuation should be above Rs 450, while Dharawat sees the stock reaching the Rs 500 mark.

An IPO for CSK?

Jhunjhunwala believes that an initial public offering (IPO) for CSK is highly unlikely over the next 2–3 years, as the IPL franchise is a prized possession and not meant for the public at large. However, considering the huge investor base, the move cannot be completely ruled out, though it would only be possible if there is strong demand from investors.

Adding to this, Dharawat said that CSK has a large number of retail investors who may look to exit at a premium valuation via an IPO, which could actually result in value unlocking for existing investors. “Stocks like CSK are niche, monopoly-like businesses with high entry barriers, which may not suit the appetite of all investors,” he added.