Pakistan Super League’s Brand Valuation Up in the Air After PCB’s New Rupee Policy

The Pakistan Cricket Board (PCB) has decided to conduct all its financial transactions with Pakistan Super League (PSL) teams in Pakistani rupees instead of US dollars. This decision has raised questions about whether it will benefit the franchises or the PCB.

The real-time brand value of the Pakistan Super League (PSL) and its franchises is still not clear.

Recently, independent foreign auditors reviewed the six existing franchises. After the evaluation, three teams — Lahore Qalandars, Quetta Gladiators, and Peshawar Zalmi — renewed their contracts for the next 10 years without any issues.

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Franchise Fee Concerns After New Rupee-Based System

The decision to conduct all PSL transactions in Pakistani rupees has raised questions in cricket circles about how the new franchise fees will work over the next 10 years.

Information gathered by this correspondent suggests that franchise fees may increase by 45 to 90 percent for the six teams. The PCB also plans to add two new teams, and their names will be announced on January 6.

How the Dollar-Based System Affected Teams

When the league began in 2016, all payments were done in US dollars. For example, Lahore Qalandars had a 10-year franchise fee of USD 25 million, meaning they paid USD 2.5 million every year.

In 2016, the dollar rate in Pakistan was 105 rupees. But within three years, the rate rose to 175 rupees, and by 2019, franchises said they were facing losses.

Lahore Qalandars’ annual fee rose from 26.5 crore rupees to 43.75 crore rupees only because of the higher dollar rate.

Other teams faced the same issue and pushed the PCB to change the financial model. The PCB agreed to increase their share in the central revenue pool to 95 percent and capped the dollar rate at 175 rupees.

Since 2019, franchises have paid fees at this fixed rate, even though the actual dollar rate has now reached 281 rupees.

What Happens in the Next 10 Years?

The big question now is whether franchises will pay more or less than they did earlier. If the PCB used today's dollar rate, Lahore’s annual fee of 2.5 million dollars would become around 70 crore rupees.

Rumours say Lahore’s new annual fee could be 66 crore rupees, but the PCB has not confirmed this.

Another major issue is that the PSL still lacks foreign investors, foreign sponsors, and foreign owners. On top of that, relations between the PCB and the most expensive team, Multan Sultans (fee: USD 6.35 million per year), are not good, as the franchise has not yet received its renewal documents.