Spectators react in the crowd during the ICC Men’s Cricket World Cup India 2023 between India and Afghanistan at Arun Jaitley Stadium on October 11, 2023 in Delhi, India.
Matt Roberts-icc | Icc | Getty Images
India is hosting the Cricket World Cup again after more than a decade.
For the first time in cricket history, India will host all 48 matches in 10 different cities – unlike in 2011 when the country co-hosted the event with Bangladesh and Sri Lanka.
Cricket is the second most watched sport in the world after football.
But in India, Bangladesh, Sri Lanka and Pakistan it is the most popular sport, with some even calling it “a way of life”.
The championship, which runs from October 5 to November 19, is expected to boost consumer spending across various sectors and could even help boost economic growth in the December quarter.
“It is difficult to estimate what impact the Games will have, but the entire tournament will have a multiplier effect on the country’s economy this quarter,” said Shantanu Bhargava, managing director and head of listed investments at Waterfield Advisors.
Hospitality, food and beverage and media advertising are some sectors where demand is likely to rise sharply, all five analysts who spoke to CNBC said.
Demand for domestic and international flights to India skyrocketed months before the start of the World Cup, with die-hard fans snapping up plane tickets even before securing a seat for the match.
Flight searches to India rose 110% to 130% in the months leading up to the World Cup, data from OTA Insight, a market research platform, shows.
According to travel analytics firm Cirium, 787 flights are scheduled to fly to Ahmedabad, where the final will be played, from November 13 to 19.
The much-awaited match between India and Pakistan took place in Ahmedabad last weekend. According to the International Cricket Council, a record 35 million fans watched the game on Saturday.
“While the data is difficult to reflect the reason for the bookings, there appears to be little correlation between the fixtures and the number of flights scheduled,” said Lalitya Dhavala, valuation consultant at Cirium.
As India progresses to the finals, the celebrations will get bigger and more people will throw parties.
Senior Research Analyst, Macquarie Group
Demand for international flights to India also rose 15%, particularly ahead of the Games due to travelers from Australia, the UK, New Zealand, Sri Lanka and the Netherlands, said Bhargava of Waterfield Advisors.
Dhavala stressed that Indian budget airline IndiGo, which will operate more than half of all flights to Ahmedabad in the final week of the World Cup, is likely to increase prices.
The Indian hospitality industry has witnessed unprecedented growth following a strong Covid recovery and demand continues to outstrip supply.
Data from software company RateGain showed hotel prices in host cities rose 125% to 300% year-on-year in the October-November period.
Pune, where India will play Bangladesh later this week, is leading the price hikes, with hotel prices rising nearly 360%. According to RateGain, hotels in Ahmedabad saw a 310% increase.
When India played Pakistan last weekend, prices at Ginger, a hotel chain owned by the Indian Hotels Company, reached 50,000 rupees ($600). “Usually it costs a tenth of the price and you can easily find a room for 4,000 rupees,” Bhargava said.
Ticket holders who had flown to Ahmedabad for the match even booked medical treatment at the city’s hospitals to find accommodation when they could not secure a hotel room, Bhargava said.
“All accommodation categories, from business hotels to Airbnbs, were sold out… This is absolute madness.”
food and drinks
Food delivery services, restaurants and corner stores will also benefit from the games.
“There is an expectation that food delivery companies will witness a rebound this quarter,” said Aditya Suresh, head of India equity research at Macquarie Group.
Suresh said food delivery company Zomato has seen an increase in transaction users and transaction frequency, and shares have risen 88% year-to-date, data from LSEG showed.
Alcohol is banned in stadiums, but fans watching the game at home or in a restaurant are likely to do so with a pint in hand.
Waiters clean their bar at a restaurant in New Delhi, India on September 8, 2020.
Prakash Singh | Afp | Getty Images
“It’s very hard to put a number on how much the sector will grow, but as it is an occasion where people come together, we are seeing an increase in alcohol sales,” said Avi Mehta, senior research analyst at Macquarie Group.
“The celebrations will get bigger as India advances further into the finals and more people will host parties,” Mehta said. “Consumption of alcoholic beverages will also increase in restaurants, although this will be limited to restaurants broadcasting the games.”
Shares of United Spirits, the owner of Kingfisher – India’s best-selling beer – are up 23% year-to-date.
Likewise, Radico Khaitan has gained 24% since the beginning of 2023.
“We expect an increase in fast trading, especially on weekends when India matches are taking place,” said Shibani Kurian, senior executive vice president and head of equity research at Kotak Mahindra AMC.
“We must not forget that the World Cup coincides with the Diwali season. Therefore, the increase in consumption during this period will be noticeable in the December quarter.”
Diwali is widely celebrated in India. The religious festival typically increases consumption of food and beverages, textiles, electronics and gold.
Media and advertising
The last Cricket World Cup in 2019 saw an average of 1.6 billion people tune in worldwide. So it’s no wonder that well-known brands such as Coca-Cola and Booking.com are this year’s sponsors of the event.
According to Bhargava, Disney+ Hotstar, the digital broadcaster of all 48 games, will generate sponsorship and advertising revenue of $300 million. This is expected to bring in close to half a billion dollars for India’s ICC, and 30% of that amount will be donated to the Board of Control for Cricket in India (BCCI).
Spectators watch the one-day international (ODI) match of ICC Men’s Cricket World Cup 2023 between Australia and Sri Lanka at Ekana Cricket Stadium in Lucknow on October 16, 2023.
Tauseef Mustafa | Afp | Getty Images
Despite the resounding success in terms of attendance, the BCCI was heavily criticized for not managing ticket sales well.
From delayed sales to website glitches to empty stands at stadiums despite being told tickets were sold out, many fans have blamed India’s cricket association and the International Cricket Council for low crowds in the first few matches .
Some angry fans took to social media to express their anger at not securing seats for the matches, saying the organization was “a mess” and had “devalued cricket’s most exciting event”.
“Organizers in India seem to have neglected ticket sales. As a cricket fan, it was very difficult for me to digest. There were a lot of vacant seats during the opening match between England and New Zealand and it remained that way even during some of India’s games,” Bhargava said.
“Many economic activities are linked to people moving around and watching the game in the stadiums… But the multiplier effect of this tournament may be somewhat dampened because ticket sales do not appear to have been managed efficiently.”
Source : www.cnbc.com