CHENNAI: Off-market transactions have resulted in investors across India indulging in the frenzied buying and selling of 400,000 shares of Indian Premier League (IPL) champions Chennai Super Kings (CSK) since 21 November, Economic Times reports.
CSK’s equity was transferred to 94,000 shareholders of its parent company India Cements a few days ago with trading occurring at Rs.12-15 per share. It has resulted in the team having brand value worth Rs. 7 billion, which is nearly 1.5 times greater than that of India Cements (Rs. 4.5 billion).
The IPL franchise was made India Cements’ wholly owned subsidiary in early 2015. With the former’s shares having a face value of Rs. 0.10, its paid-up capital is worth Rs. 31 million.
“Many investors who got CSK shares early this week were seen selling them off market between Rs 13-15 per share. Savvy investors are interested in buying CSK shares.” Mumbai-based stock broker Narottam Dharawat, who deals in unlisted shares, was quoted as saying to ET.
“There is a good demand for CSK shares in off market as it’s currently trading at a discount to its brand value,” ARMS Securities’ director Sambhav Aggarwal, who is based out of Delhi, said.
“Nearly 4 lakh shares changed hands in the last two days at a price between Rs 12 and 15,” Delhi-based trader in unlisted shares, Anil Goel said.
However, it is believed that CSK’s shares can be traded at higher levels or prices, which isn’t happening at present due to its 2018 return in the IPL, following a 2-year ban. The market dynamics of sports businesses’ shares seems to have changed after JSW Sports paid Rs. 5.5 billion to buy a 50% stake from the GMR Group to co-own Delhi Daredevils earlier this year.
