Goenka's growing interest in the business of sport

  • “Such spontaneity,” Goenka said, the voice rising just so. “This kind of connect is unbelievable. How do you weigh that in monetary terms?,” said the man whose business group has, according to its website, an asset base of $6 billion and revenue of $4 billion.
Sanjiv Goenka(Mint File Photo)
Sanjiv Goenka(Mint File Photo)
Published on Oct 27, 2021 07:19 AM IST
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Red lights are necessary irritants but stopping at one gave Sanjiv Goenka a moment he hadn’t experienced in years of being chairman of the RP-Sanjiv Goenka Group (RPSG). Goenka was on his way to the Salt Lake stadium for a game featuring Atletico de Kolkata (ATK), a football team where he was the majority stake holder. They were the defending champions of the Indian Super League (ISL) but having lost two on the bounce things were not looking good early in the second season in 2015.

His car got spotted by a group of young men on motor-cycles and they hollered his name before telling him, in Goenka’s words, “don’t worry, you will win, we are praying for you.” At this point, Goenka paused — he did that a lot between speaking softly in measured sentences. “Such spontaneity,” he said, the voice rising just so. “This kind of connect is unbelievable. How do you weigh that in monetary terms?,” said the man whose business group has, according to its website, an asset base of $6 billion and revenue of $4 billion.

Now owner of the new team from Lucknow in the Indian Premier League (IPL), Goenka was narrating this story on a late December morning after getting the rights of IPL’s Pune franchise. By then ATK had recovered and made the semi-finals and Goenka said, the Salt Lake stadium was sold out for the return-leg.

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We were in his old office in central Kolkata on the fifth floor of Victoria House, the headquarters of the Calcutta Electric Supply Corporation (CESC), the group’s flagship company which supplies power to most of Kolkata. East Bengal, Mohun Bagan and Mohammedan Sporting, the Maidan’s iconic sports clubs, were less than a brisk 20 minutes’ walk away but despite having lived all his life in Kolkata —Goenka is comfortable speaking in Bangla—sport really wasn’t his thing till April 2014 when he, businessmen Harsh Neotia and Utsav Parekh joined Sourav Ganguly to successfully bid for Kolkata’s ISL team.

By 2014 when he became an owner in ISL, Goenka had developed an interest in the business of sport, spurred by the interactions he had with students soon after he was appointed chairman of IIT, Kharagpur, for the first time, in 2002. ISL came at a time when Goenka had consolidated his lines of businesses nearly four years after Rama Prasad Goenka wanted to divide the empire between his sons Sanjiv and Harsh. The spark that began by his association with bright, young minds in Kharagpur was reinforced at the red light in Kolkata.

The Pune franchise followed months after ATK won ISL1. The RPSG Sports Business now has ATK Mohun Bagan, a team formed by the merger of the ISL and I-League champions in 2020, a team in the franchisee table tennis league and two awards programmes, one of them with the Virat Kohli Foundation.

Sport, Goenka had said, is a combination of four Cs—commerce, connect, communicate and CSR (Corporate Social Responsibility). “But, all of this must be financially viable even if we lose money to begin with.” Like now, where he has explained why the bid of 7090 crore—nearly 2000 crore more than the next highest for Lucknow—is not that outrageous because almost 50% returns are assured from television rights. “It is an opportunity (even if it for two years). The opportunity has a cost to it. Is the cost worth its while? The answer to all of us was, yes,” he said, explaining why he had bid for Pune.

With football and table tennis, where the money spent is a fraction of the IPL, brand promotion may not be that big a deal though Goenka did say the experience of having CESC on ATK’s shirt in 2015 “was way more than the investment.” With cricket it could well be an important vehicle for the group’s myriad business interests from power, fast moving consumer goods, media and entertainment, retail, IT-enabled services and carbon black manufacturing.

Goenka has hit bumps but hasn’t bailed unlike many corporate titans once associated with football. The Pune franchise finished seventh in 2016. “The first season was a disaster and I wanted it to end soonest, with our dignity intact,” he told HT in an interview two days before the 2017 IPL final. Eleven players were changed; the captaincy shifted from MS Dhoni to Steve Smith and the team finished runners-up to Mumbai Indians by one run.

After winning two of the first three iterations of ISL and playing the semi-finals in another, ATK slumped to ninth among 10 teams in 2017-18; the owners fumbling with players and coaches after the partnership with Atletico de Madrid, which had a 25% stake from 2014-16, ended. For two seasons, ATK floundered due to poor recruitment before Antonio Lopez Habas returned as coach in 2019-20 and they won again. A big part behind the win is that Goenka hasn’t baulked at assembling an expensive first team roster.

“The vision is that the new club will strive to be successful not just in Bengal, not just in India but in Asia over a period of time,” Goenka had said over the phone on January 16, 2020, after the merger with Mohun Bagan was announced.

It will need a lot of work before that vision is realised and as much work to get the Lucknow franchise up and running in the IPL. But then Goenka has said he is not an impatient man.

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