Hyundai Motor India Ups Ad Budget Ahead Of IPO

Over the last two fiscal years, Hyundai Motor India has boosted its advertising and marketing spending dramatically in anticipation of its impending initial public offering (IPO). To solidify its standing as a reliable brand in the Indian market, the carmaker has reaffirmed its commitment to carrying out these initiatives. In just ten days, the South Korean automaker's Indian division is scheduled to launch on the Indian stock market.

The estimated size of Hyundai Motors' IPO is Rs 27,870.16 crore. The Creta car manufacturer has established a pricing range of Rs 1,865–1,960 per share. The issue will go live on October 15, 2024, and run until October 17, 2024.

As per the June submission of the Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (Sebi), Hyundai Motors incurred expenses of Rs 677 crore for standalone sales promotion and advertisement during the fiscal year 2023 (FY23). In comparison with FY22 expenditures of Rs 491 crore, which were mostly driven by campaign displays and new launches, advertising expenses increased 37.66 per cent.

In the future, Hyundai intends to spend money on specialised advertising campaigns via sponsorships, digital media projects, TV commercials, gaming shows, sporting events, and celebrity endorsements.

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 agreements with 363 dealer businesses for sales and distribution in India. Interestingly, Hyundai spends much less on advertising than its competitor, Maruti Suzuki India. Compared to FY 2022, the Indian arm of Japanese manufacturer Suzuki Motor Corporation spent Rs 947 crore on sales and advertising, up from Rs 668 crore. Furthermore, Tata Motors' independent publicity costs were Rs 321.4 crore in FY22 and Rs 439.7 crore in FY23.