Mahendra Singh Dhoni: As MS Dhoni hangs his boots for the Men in Blue, Club Yellow fades too

New Delhi: When Mahendra Singh Dhoni announced retirement from international cricket this past Saturday, unlisted shares of IPL franchise Chennai Super Kings (CSK), which he leads, saw a small correction in the unofficial market for trading in such shares.

CSK shares have plunged over 10 per cent in the past couple of weeks and traded at Rs 48-50, coming down from Rs 52-55 in August first week.

In November 2018, the stock traded at Rs 13-15 per share, giving the entity a valuation of Rs 450 crore. It has gained about 400 per cent in last one-and-a-half years.

Dealers said the correction over the weekend was more of sentimental, and they are very confident about the prospects of the sports franchise in the long run, as the fundamentals remain strong.

“This is more positive than negative for CSK, as he will continue to play IPL. The team may capitalise this business opportunity over the next couple of seasons, contributing to more revenues,” said Sunil Chandak of Mumbai based Gennext Investrade, which deals in such shares.

“Dhoni will now be an exclusivity for IPL,” he said. “This might increase advertisement rates for matches of Chennai Super Kings. Everyone will tend to monetise the nostalgia associated with Dhoni.”

The 13th edition of IPL kicks off on September 19, 2020. It is highly anticipated that the next edition will be held as per the normal schedule over March-May 2021, which may feature MS Dhoni once again.

According to off-market dealers, Dhoni is not the sole reason behind the recent correction in the stock. “The exit of Vivo as title sponsor has added to the pain. However, a new title sponsor is likely to be named this week,” he said.

In FY20, CSK generated Rs 50.33 crore PAT on a consolidated basis, which was 54.7 per cent less than Rs 111.2 crore reported for FY19. Revenue for the previous financial year plunged 14.7 per cent to Rs 356.53 crore from Rs 417.43 crores a year ago.

Dinesh Gupta of Delhi-based UnlistedZone said the stock has deep value with strong investors like Radhakishan Damani and LIC of India backing it. “As the tournament comes closer, the stock is likely to move northward and there is little room for downside,” he said.

Gupta senses emotional reaction to the stock on Dhoni’s retirement. “It may affect the brand for a while, but ultimately performance of business will improve,” he said.

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