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Shailendra Gaikwad: Owns the Rendezvous group of hotels Sanjay Gaikwad: MD of UFO Moviez
Vivek Venugopal: of Elite Group of Kerala
Dilip Mehta: Rosy Blue Diamonds, a big jewellery outfit
Mehul Patel: of Anchor Earth, electrical goods manufacturer
Mukesh Patel: of ship-breaking company Shri Ram Vessels
Anand Shah Real estate mogul
When the Indian Premier League went casting its line, looking for 9th and 10th cities to retail its annual fare of tamasha cricket, Kochi heeded the call with a stupendous cheque of $333.33 million (Rs 1,500 crore). Everyone was surprised. Kochi in Kerala, after all, isn’t writ large on the sports consciousness as a cricketing city; most IPL teams are believed to be in the red in the third year of their operations, even though they were bought at much lower prices. Is it really a viable investment for the buyers of the Kochi IPL franchise?
But Kerala abounds with contradictions that clamour for attention—a bastion of the Left, which is currently in power, it is also said to be India’s No. 1 consumer state. It’s full of lavish spenders of money, desperately seeking housing; the urban-rural divide doesn’t exist, it’s an integrated market, a marketing man’s dream. With only 3.7 per cent of the Indian population, Kerala accounts for 12 per cent of the Indian consumer market, fuelled by steady remittances from its Gulf expats.
At an annual orgy before the god of consumerism, Kerala treats money like the abundant water it’s been blessed with. In the recent Grand Kerala Shopping Festival, for instance, economists estimate shoppers spent over Rs 1,000 crore in 45 days in December-January—this despite the state supposedly reeling under the ripple effects of the economic bust-up in Dubai. A second-tier city ranking below the metros, Kochi, the commercial capital of the state, also faces an acute housing shortfall despite a spurt in construction. A report prepared by the Confederation of Indian Industry and Institute for Competitiveness states that Kochi ranks among cities with the worst house-cost and availability parameters. A housing boom beckons.
There is a clear link between this and the IPL acquisition. Four partners of the Rendezvous consortium—buyers of the Kochi IPL franchise—have interest in the real estate market and one, Rosy Blue Diamond, is eyeing the Kerala market, which seems to have an unquenchable thirst for jewellery.
Cricket aficionados watch Sreesanth at the IPL in a TV showroom in Kochi
They like cricket too, actually. It is the No. 2 sport in the state after football, and when Malayalam movie superstar Mohanlal pulled out of the bidding to buy an IPL team earlier in March, there was widespread disappointment, soon replaced by elation that Kochi would have an IPL team, after all. It’s a matter of great pride—many people Outlook talked with were full of it. They mentioned Kochi boy S. Sreesanth as a potential No. 1 fast bowler of India, they recalled Tinu Yohannan as the first Kerala player to represent India; they also claimed partial proprietary rights on players with Kerala connections in other state teams like Robin Uthappa and Abhishek Nayar, and former India bowler Abey Kuruvilla. “Tamil Nadu has a team, Karnataka has a team in the IPL,” say MBA-hopefuls Sharath and Pavitra. “Now we too have one, we too have something to cheer for.”
“It’s recognition of Kochi as the economic capital of Kerala,” says Kochi-based economist Ajit Kumar. “The average Malayali is a very emotional and competitive person, and it satisfies his ego to have a team in the IPL.” He also mentions a more compelling reason for the presence of the IPL in Kochi—fiscal fluidity and demand for housing. “I’ve estimated that by the end of the 11th Five Year Plan (2007-2012), there would be a demand for 1,20,000 housing units in Kochi alone,” he says. “At present, 50,000 units are available—the shortfall is massive, and that’s why so many builders are among the Kochi owners.” They want to build a brand through the IPL and lure customers to future housing projects.
One of the owners is Vivek Venugopal of the Elite Group of Thrissur, which has interests in the food and construction industry. Venugopal—the only Malayali co-owner of the team—told Outlook that all team owners of the Kochi franchise are friends, and that the idea of owning an IPL team was born last year. “Initially at the bidding, we didn’t come forward because the preconditions were daunting,” he said. “Later, when the preconditions were changed (removal of the clause requiring the potential franchisee to demonstrate a net worth of $1 billion, and requiring the winning bidder to pay an advance guarantee of $100 million), we decided to bid for Kochi, on the advice of Union minister Shashi Tharoor.”
The marketing opportunities Kerala presented was the motive for the co-owners. “Kerala has great potential for us because it’s a small, literate, high-density state, the fan base is integrated and easily accessible, there’s a strong, significant nri influence, and there exist strong entertainment possibilities,” says Venugopal. “Kerala’s got a mammoth consumer market—all FMCG companies are here because it’s a huge market for them.”
Guiding spirit Shashi Tharoor in action at a friendly match in New Delhi
It’s still not clear whether cricket itself would rake in much money at the gates. The Kerala Cricket Association stadium won’t be ready before 2012; the Nehru Stadium, under renovation, has held one-dayers in the past before packed crowds. The IPL has assured Kochi of an alternate “home” stadium if their own venue isn’t ready by next year. Dr Kumar, once part of the Association, says even though IPL is not really serious cricket, initially there would be some following due to curiosity. “The stadium would be full, I think, for the first few games,” he says. “But I don’t expect much money from gate collection—during the one-day matches, from sell-out crowds, we could manage only Rs 65 lakh! The tickets can’t be priced high, do you think the very unions we have here would agree? No chance.” He says that, as a cricket administrator too, he does not see the economics of IPL working, unless rules are changed and more money is shared by the IPL from the TV rights; the notional gains, though, would accrue to the franchise owners, like brand-building and prestige. “And that’s the reason they’re here.”
Most people are confident that the city and the state would gain too. S.A. Manzoor of the Kerala Chamber of Commerce and Industry says the IPL would boost tourism and allied industries. “The ecosystem for that sort of an effect is already in place, and things can only improve,” he says.
Nothing’s wrong in the reduction of cricket into business, says award-winning Malayali and English writer K.L. Mohana Varma, who has written a novel on cricket. “W.G. Grace, when once dismissed early, batted on, telling the bowler, ‘people have come to watch me bat, not you bowl!’” Varma laughs. “From then on, organised cricket was not about people playing to enjoy—from a players’ game, it became a viewers’ game.” Varma, like so many others, believes IPL is not cricket but just a reality TV show. “But the viewer is happy,” he says, “which is better than getting happiness by getting drunk.”
Kerala, which had been parched under a partial spell of prohibition in the not-distant past, might get drunk on cricket next year on. At what cost to the game and consumer, there would be time enough in future to reckon.