NEW DELHI - Hyundai Motor Co is bracing for tougher competition in India as more global rivals attack the small-car segment, but said it would continue to be a top player due to its big volumes and sprawling sales network.

Hyundai, South Korea's top automaker, is the No.2 brand in the fast-growing Indian market with about a 16 percent share, thanks to a strong line-up of compact cars such as the i10 and i20 hatchbacks.

While big global players such as Toyota Motor Corp and Honda Motor Co have announced plans to attack the dominant compact segment, Hyundai Motor India Director Arvind Saxena said having a product was just one part of the equation, with a solid sales network being vital to becoming a big seller.

Especially in a market (as big as) India, it's very difficult to cover, Saxena said on the sidelines of the Delhi auto show on Wednesday.

Today we are spread out in 260-odd cities with 286 dealerships and 80 sales branches. We have deeper penetration, he said, adding that Hyundai planned to expand that further to 320 dealerships and about 130 branches this year.

Saxena conceded, however, that profitability will come under pressure as competition heats up.

But he was optimistic that India's car market would remain strong this year if excise duties and interest rates stayed stable, although last year's growth rate of 17-18 percent would be difficult to match.

For Hyundai, Saxena said exports would be more challenging than in 2009, echoing views from local rival Maruti Suzuki India, which expects tough exports due to a likely drop in European demand this year.

Hyundai would explore exports from its Indian factory to new markets such as Australia and New Zealand, Saxena said.

(Editing by Lincoln Feast)

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