RCB's $2 Billion Valuation 'Win-Win For All': Suhel Seth On Adar Poonawalla's New Interest

Diageo Plc. has been considering options to transfer of ownership of RCB. The British distiller had reportedly held discussions with potential advisers and has been seeking a valuation of as much as $2 billion, as reported by Bloomberg.

Seth says the proposed transaction sees a significant payoff for the current owners, Diageo, the global spirits giant. When the company initially acquired the franchise, they were estimated to have spent approximately $100 million. Today, the team is reportedly valued at a staggering $2 billion.

"You are looking at an exponential increase of brand value that is unimaginable,” Seth commented. This potential sale aligns with Diageo’s stated commitment, under its global CEO Nik Jhangiani and India head Pravin Sumeshwar, to focus intensely on its core, high-value spirits business. Seth said Diageo India has performed "remarkably well on its assets despite the Herculean task to run an alcohol business in India."

While Seth believes the transaction is a strong fit for both parties, he cautioned that "an investment is only worth the price it is made at." However, he also justified the $2 billion price tag, which he said did not appear "out of the air."

The brand guru attributed the hefty valuation to the relentless growth of the IPL itself. “Over the years, IPL has shown exponential fan base increase, exponential value increase. We have seen greater media spends and we have seen media investments from streaming platforms, from television channels. A lot of that money sprouted back into the franchise owners.”