The Ambanis-controlled advertising major, Mudra Communications Ltd, is gearing up towards diversifying into event management in a big way following in the footsteps of Amitabh Bachchan Corporation Ltd which has been instrumental in popularising the concept as a lucrative business interest in India.
Speaking to Business Standard, A G Krishnamurthy, CMD, Mudra Communications, said the company plans to achieve this by entering into technology tie-ups with foreign companies. "Negotiations are underway and the process is expected to be completed within the next one year" he added.The company's total capitalised billing for 1996-97 has been worth Rs 360 crore. The growth rate of business this year has been slow at 15 per cent as compared to 18 per cent over 1995-96. Mudra however expects to achieve a growth rate of 25 per cent during 1997-98.
Krishnamurthy expressed the view that the next fiscal is likely to be a lucrative year for financial advertising.
The recent Union budget has thrown up several incentives to companies leading to buoyancy in the stock market which in turn is expected to spin off a number of public issues, he said.
Mudra expects to expand its client list with its plans for capitalising on the event management business. Mudra has recently applied to the FIPB for permission to enable it to raise its foreign equity holding upto 74 per cent. This purpose of the application is to enable its foreign partner, UK-based DDB Needham
Our Mumbai bureau adds: The decision by the Ambanis to hike foreign equity in Mudra Communication to 74 per cent is primarily aimed at retaining global clients and pitching for new MNC accounts. The decision is in keeping with the trend, as it is difficult to feature within the top ten ad agencies without a global partner, opined ad experts.
"It is very important to have a foreign partner as most big clients today are MNCs and most campaigns are global in nature. Besides, foreign tie-ups help in better resources, technical skills and hence better output. A foreign partner would also mean better brand equity and financial support,'' a top ad professional said.
