How the Indian Premier League Makes Money & Distributes Profits Between Franchises (Explanation)

The Indian Premier League (IPL) has become one of the most popular and lucrative sports leagues globally. As a professional T20 cricket league, it attracts millions of viewers and generates massive revenues each year. But how exactly does the IPL make money, and how are profits distributed between franchises? In this article, we’ll explore the different revenue sources, how franchises make money, and how the profits are distributed among them.

How the Indian Premier League Makes Money & Distributes Profits Between Franchises (Explanation)

Understanding the Indian Premier League (IPL)

Brief history

The IPL was founded in 2007 by the Board of Control for Cricket in India (BCCI). The first season took place in 2008, and since then, it has grown exponentially, becoming a significant event in the world of cricket.

Structure and format

The IPL consists of ten franchises, representing different cities in India. Each team plays 14 matches during the regular season, with the top four teams advancing to the playoffs. The competition’s format has allowed it to become highly popular among fans and attractive to sponsors and broadcasters.

Primary Revenue Sources

Broadcasting rights

The IPL’s primary revenue source comes from broadcasting rights. Media companies bid for the rights to broadcast the matches on television and digital platforms. In 2017, Star India acquired the broadcasting rights for a whopping ₹16,347.5 crores (about $2.55 billion) for a five-year period. This deal has played a significant role in boosting IPL’s revenues.


Sponsorships are another significant revenue source for the IPL. Various companies sponsor the league, with their logos appearing on team jerseys, stadiums, and other promotional materials. In 2020, Dream11, an online fantasy sports platform, won the title sponsorship rights for ₹222 crores (about $30 million).

Ticket sales

Ticket sales also contribute to the IPL’s revenues, with each franchise earning a percentage from ticket sales during their home matches. Although this revenue stream was affected by the COVID-19 pandemic, it remains an essential part of the league’s earnings.

How IPL Franchises Make Money

Franchise fees

Each franchise is required to pay an annual fee to the BCCI. These fees contribute to the league’s overall revenue and are part of the central pool that gets distributed among franchises.

Sponsorships and partnerships

Franchises make money through sponsorships and partnerships, similar to the league itself. They sign deals with various companies, allowing them to display logos on team jerseys and promote their products during matches. These partnerships help franchises generate significant revenue.

Player trading

IPL franchises can also make money through player trading. They can buy and sell players during the annual player auction, allowing them to profit from the difference between the buying and selling prices.

Profit Distribution Between Franchises

The BCCI distributes the IPL’s revenue among franchises in two primary ways: central pool revenue and franchise-specific revenue.

Central pool revenue

The central pool consists of broadcasting rights fees, title sponsorship fees, and other league-wide sponsorships. The BCCI distributes this revenue among franchises on a predetermined percentage basis. As of the current arrangement, 50% of the central pool revenue is shared equally among the franchises.

Franchise-specific revenue

Franchise-specific revenue includes income generated by each franchise through its own sponsorships, partnerships, and ticket sales. This revenue is not shared with other franchises, allowing each team to benefit directly from their marketing and promotional efforts.

Economic Impact of IPL on India

The IPL has a significant economic impact on India, contributing to job creation, tourism, and infrastructure development. The league generates employment opportunities for players, support staff, and stadium personnel, among others. Additionally, the influx of tourists during the IPL season boosts the local economy, particularly in the hospitality and retail sectors.

Challenges and Opportunities for IPL

Despite its success, the IPL faces challenges, such as competition from other T20 leagues and the effects of the COVID-19 pandemic. However, the league also has opportunities for growth, including exploring new revenue streams, expanding to international markets, and capitalizing on digital platforms.


The Indian Premier League has established itself as a major player in the world of sports, generating substantial revenues through broadcasting rights, sponsorships, and ticket sales. Franchises also benefit from these revenue streams, as well as their own marketing efforts.

The profit distribution system ensures a fair share for all franchises, contributing to the league’s overall success and financial stability. With continued growth and innovation, the IPL’s economic impact on India and the sport of cricket is expected to remain strong.

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What are the primary revenue sources for the IPL?

The primary revenue sources for the IPL are broadcasting rights, sponsorships, and ticket sales.

How do IPL franchises make money?

IPL franchises make money through franchise fees, sponsorships and partnerships, and player trading.

How are profits distributed between IPL franchises?

Profits are distributed between franchises via central pool revenue and franchise-specific revenue.

Rivcky John

A prominent figure in sports journalism for the last two decades. Cricket Analyst & Writing News, Features, Match Previews/Reviews/Reports, And Opinion Pieces on Cricket. You can connect with him on Facebook also.