Micromax Gearing Up For An IPO, Possible Explanation For Crazy Ad Spend

by Ankit Agarwal on August 24, 2010

Micromax – The brand that probably has hogged the primetime advertisement spots specially during sporting events. For the uninitiated, Micromax is a mobile handset maker which has taken the Indian market by storm at least when it comes to visibility through advertisements. It is another matter that Micromax brand statements et all have contributed profusely for some mindless fun at social networks.

I do not watch a lot of TV but Micromax advertising madness is bought out too frequently in discussions with friends offline and online. Now, in a market dominated by the Nokia and fierce competition from the likes of Samsung, HTC, Sony Ericsson i always thought Micromax does not stand a chance to compete in the price sensitive yet value seeking Indian marketplace. But numbers don’t lie, Micromax is apparently the third largest mobile phone vendor in India after Nokia and Samsung

So the advertising must be paying off for Micromax, but even then taking prime time spots during IPL etc. must not be cheap. So, was the crazy advertisement justified to drive the sales. May be not, but there might have been an method to the madness for Micromax to go berserk with TV advertising.

Yes, Micromax is gearing up for an IPO during the end of the year
Micromax is planning to launch an IPO offering to raise as much as $750 Mn and has shortlisted Citigroup, Edelweiss and JM Financial to assist with the IPO. Micromax IPO is expected to be out towards the year end with the approval documents submitted to SEBI by next month.
With an IPO looming large, Micromax through its advertisements has ensured visibility amongst the masses. The fact that it is operating in the low cost feature rich mobile phones should also work in its favor. However, only time will tell if the advertisement spends are going to have a positive impact on the IPO. As of right now, it is a given that almost everyone will atleast know what Micromax is by the time the IPO hits the marketplace

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