RPSG Group chairman Sanjiv Goenka defended his group’s mammoth bid of Rs 7090 crore bid to secure the Lucknow franchise in the Indian Premier League and suggested that his group had done their math.

The RPSG-led venture had the highest bids by a long margin for the Ahmedabad as well as the Lucknow franchise and the sum has caused a stir in the Indian cricketing world.

However, Goenka feels he has obtained the franchise at a fair value.

“I don’t think it’s a high value. It is a fair value. One is bound to face an operating loss but one doesn’t bid these numbers based on passion. There is an economic and scientific decision behind bidding these high numbers,” Goenka told NDTV.

“Today I am getting an IPL team for a net present value of Rs 2,100 -2,250 crore now... that is the way I look at it. With maybe year four or year five, with the permission of BCCI, I could actually dilute 25%. By that time, I expect the valuation to be Rs 10,000 crore and if I dilute 25% at a value of Rs 10,000 crore, the entire thing becomes free for me,” he told the channel.

Goenka chose the Lucknow franchise over the Ahmedabad one as he felt he could connect with the people of the north Indian state where his company have operations.

“We have operations in Uttar Pradesh. We do power distribution there. We have a very big presence in the northern state. Closer by in Chandigarh, we have the power distribution rights. So for North India, that becomes like a hinterland,” Goenka told Cricbuzz in an interview.

The RPSG Group owned the Rising Pune Supergiants franchise for two seasons wants to make the new team about young talent.

“A young and determined team can still work well. We will build team around a younger lot of players. I feel the young cricketers are equally competent,” Goenka told NDTV.

The RPSG Group also owns the Indian Super League franchise ATK Mohun Bagan and have been spending big on the team ahead of the new season.