Hyundai Motor India increases ad budget as IPO nears, eyes trusted brand positioning
According to the Draft Red Herring Prospectus (DRHP), submitted to the Securities and Exchange Board of India (Sebi) in June this year, Hyundai Motors has spent Rs 677 crore on advertisement and sales promotion on a standalone basis in fiscal year 2023 (FY23)
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Hyundai Motor India Ltd, which is preparing for its upcoming IPO, has significantly increased its spending on advertising and marketing over the last two fiscal years. The automaker has affirmed its commitment to continue these efforts in order to strengthen its position as a trusted brand in the Indian market. The Indian arm of the South Korean automaker is set to make a debut in the Indian stock market in just 10 days.
Hyundai Motors's IPO size is pegged at Rs 27,870.16 crore. The maker of the Creta car has set a price band of Rs 1,865-1,960 per share. The issue will open on 15 October 2024 and conclude on 17 October.
According to the Draft Red Herring Prospectus (DRHP), submitted to the Securities and Exchange Board of India (Sebi) in June this year, Hyundai Motors has spent Rs 677 crore on advertisement and sales promotion on a standalone basis in fiscal year 2023 (FY23). The ads expenses saw an increase of 37.66 percent in contrast to FY22 expenditure at Rs 491 crore driven by campaigns exhibitions and new launches.
Hyundai has planned to invest in targeted marketing campaigns through digital media initiatives, sponsorships, television advertisements, gaming shows, and sporting events and celebrity endorsements in the future.
In the DRHP, the automaker mentioned, "We collaborate with our dealers for promotion and advertising through various media and supply dealers with promotional materials for sales and service marketing".
As of December 31, 2023, Hyundai Motor India had partnerships with 363 dealer companies for distribution and sales in India. Notably, Hyundai's advertising expenses lag significantly behind those of its rival, Maruti Suzuki India. The Indian subsidiary of Japanese automaker Suzuki Motor Corporation spent Rs 947 crore on advertisement and sales as compared to Rs 668 crore in FY 2022. Additionally, Tata Motors' standalone publicity expenses in FY23 and FY22 stood at Rs 439.7 crore and Rs 321.4 crore, respectively.
