RCB Stake Buyer Might Not Be From Alcobev Industry: Elara's Karan Taurani

Buyer of Royal Challengers Bengaluru's stake might not be from the alcobev industry, according to Karan Taurani from Elara Capitals. "It's going to be some corporate conglomerate who wants to enter this space," he told NDTV Profit.

Earlier today, NDTV Profit reported that British distiller and United Spirits Ltd.'s parent Diageo Plc is evaluating options to sell a partial or full stake in Royal Challengers Bengaluru.

RCB, which recently won the IPL title for the first time in its 18-year run, is likely to be valued better. According to the people quoted by NDTV Profit, Diageo is expecting strong interest from potential buyers.

Taurani highlighted that the selling of RCB could happen at $2 billion. "It would be $2 billion valuation to be at the expensive end of the band. We don't see RCB getting any better exit than this, especially in the next 3-4 years," he added.

Taurani highlighted that existing teams could trade at higher valuations due to being incumbents.

"Most teams are backed by major corporate houses, and the league is unlikely to expand beyond 10–12 teams. So, anyone eyeing entry into the business will view it as a limited and valuable opportunity," he added.

United Spirits, however, has said that the reports are speculative in nature and they are not pursuing any discussions regarding potential stake sale in RCB.

Initially owned by liquor baron Vijay Mallya, RCB is one of the earliest teams in the IPL, with a large fan following, especially in the city of Bengaluru. It was also a way for Mallya to market his alcohol brands, as India prohibits direct advertising of alcoholic products.