The IPL was deliberately engineered as a low-risk, high-leverage franchise model in a way that the NFL or EPL are not. Two design choices sit at the heart of this: (1) the way stadium costs sit largely outside franchise balance sheets and (2) a hard, centrally enforced salary cap that stops player wages from eating the league alive.
Put simply, the IPL socialises the heavy, long-term costs at the BCCI/state-association level, while privatising a big chunk of the upside at franchise level. That’s a very different equation to a Premier League club drowning in wage bills or an NFL team carrying billion-dollar stadium debt.
When the IPL comes to town, three things happen financially:
- State associations handle the heavy lifting on infra and upkeep. Their budgets are fed significantly by BCCI distributions from media rights and other revenues, which fund stadium construction, refurbishment and maintenance.
- BCCI pays hosting subsidies. BCCI payment disclosures show regular “hosting subsidy of IPL match” transfers to associations like CAB (Eden Gardens), HCA (Hyderabad), GCA (Ahmedabad), TNCA (Chennai) and others.
- Franchises pay a hosting/ground fee, not full stadium economics. They usually get the bulk of ticket revenue from home games, with a share going back to the state association in return for use of the facility and local services.
In other words, the franchise is renting a high-end asset on a seasonal basis, not funding or carrying its long-term capex and fixed opex. That alone radically improves the P&L profile compared with clubs in Europe that are on the hook for billion-pound stadium projects or NFL teams sitting on massive privately financed or public-private stadia.
The second big piece is how revenue is structured. For the 2023–27 cycle, IPL media rights were sold for about ₹48,390 crore to Star and Viacom18. 70–80% of the IPL’s total revenue typically comes from these media rights and central sponsorships, forming the “central pool”.
The split is roughly:
- BCCI retains around 50% of central revenues.
- About 45% is distributed among franchises.
- The remaining ~5% goes as prize money.
That central share is divided largely equally among the ten teams, regardless of league position (with some performance-linked tweaks). Even with recent headwinds, this central pool remains a powerful stabiliser for franchises. The central revenue alone can cover ~90% of a franchise’s operating costs in some cases; everything else (local sponsorship, ticketing, hospitality, merchandise) sits on top as margin or growth capital.
Because squads are small, seasons are short (14 league games plus knockouts) and the cap is hard, an owner can model wage costs with a degree of certainty that is impossible in most European football environments.
The league also enforces retention rules and deductions from the purse that discourage extreme over-bidding for a handful of stars.
Functionally, this keeps player wages at a manageable share of revenues and prevents an arms race where one irrational owner can distort the entire market.
Many NFL teams are deeply entangled with stadium finance and operations, whether through private funding, municipal bonds or complex public-private structures. Those facilities are year-round commitments, with debt service and operating costs that don’t go away in the off-season.
The Premier League is closer to the Wild West, though that is slowly changing. There is no traditional hard salary cap. Instead, clubs are governed by Profit & Sustainability Rules and, from 2026-27, a Squad Cost Ratio rule that will cap spending on wages, transfers and agents at 85% of revenue.
Investors like three things:
- Predictable central cash flows from long-term media deals.
- Capped downside on costs via wage caps and asset-light stadium exposure.
- Upside optionality from local sponsors, global brand building, merchandise, academies, women’s teams and future tournaments.
The IPL ticks all three. A Premier League club may have more absolute upside in a global, year-round sport, but the downside risk is much higher and the cost base structurally heavier.
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