Micromax to bring in 5G phones at aggressive price points.
Micromax on Friday said it will significantly bolster its product portfolio this year, bringing in 5G devices as well at "aggressive price points", as the homegrown handset maker looks to re-capture its leadership position in the hyper-competitive Indian smartphone market.
Micromax, which has created a Rs 500 crore war chest to invest across is operations, is also scaling up its smartphone manufacturing capacity in the country to meet the strong demand it is witnessing for its products.
"We only have two products right now but I must say its been a 'dreamy comeback'. By March-end, we should have one more product in the market and from April onwards, the plan is to bring in 4-5 products every quarter and refresh the portfolio every 6-8 months," Micromax co-founder Rahul Sharma said.
He added that the company is already working on a 5G device, and it would hit the market in the second half of the year. "People already have a lot of interest in 5G, they want 5G-ready smartphones...we are in advanced stages of working on our 5G product that will be priced most aggressively," Sharma said.
He added that the company is also looking at now ramping up its offline presence, and will be present in over 15 states and 18,000 retail counters by next week.
Micromax's devices (smartphones and feature phones) are made by Bhagwati Pvt Ltd at three facilities in Bhiwadi (Rajasthan), Rudrapur (Uttarakhand) and Hyderabad (Telangana).
"The total capacity currently is 2 million smartphones a month, and we are scaling this up to 3 million units gradually," Sharma said. The company has stated that it will be investing Rs 500 crore in manufacturing and R&D till 2022.
"We have already invested Rs 100 crores in the last one year in ramping up the the manufacturing facility and adding SMT (Surface-mount technology) Lines," he added.
Sharma pointed out that in terms of value, 60-70 per cent of the components in its smartphone are now locally sourced. Talking about the supply chain constraints, Sharma said this is an issue that is affecting the industry overall.
"If you look at semiconductors, whether it is for phones or laptops or even electric cars, the demand has zoomed amid the pandemic while the supply has remained the same. Semiconductors is a critical component and it being in short supply, is a challenge for the industry," he pointed out.
The top executive added that the company is also exploring alternative resources in terms of supplies to tackle the situation. Sharma lauded the government's focus on promoting local manufacturing and self reliance.
"I think as a country we are going to have an interesting stage...in terms of opportunities that the country is offering right now, in every industry. Of course, the call for Atmanirbhar Bharat is also gathering pace... certainly our country has its own challenges but atleast the thought process in now there," he said.
The government had announced a PLI scheme that extended incentive of 4-6 per cent on incremental sales (over the base year) of goods under target segments that are manufactured in India to eligible companies, for a period of five years subsequent to the base year (2019-20).
The government had cleared proposals from domestic and international companies - including iPhone maker Apple's contract manufacturers Foxconn Hon Hai, Wistron and Pegatron, apart from Samsung, Rising Star and Bhagwati - entailing an investment of Rs 11,000 crore under the PLI scheme to manufacture mobile phones worth Rs 10.5 lakh crore over the next five years.
On Wednesday, the government approved a Rs 7,350-crore PLI scheme to boost production of laptops, tablets, all-in-one PCs and servers in the country, a move that would nudge global and domestic players to manufacture these products in India.
Asked if the company would look at local manufacturing in categories like laptops to benefit from the recently-announced PLI scheme, Sharma answered in the negative.
He said the domestic opportunity for smartphones is huge and the company is focussed on meeting that requirement currently. Once a market leader, Micromax lost its position to players like Xiaomi, Oppo and Vivo as these Chinese giants captured the Indian market with their aggressively priced smartphones and massive marketing spends.
Micromax announced its comeback last year and has so far, launched two smartphones under the 'in' brand. It plans to bring devices in the Rs 7,000-25,000.
India saw smartphone shipment at over 150 million units in the pandemic-hit 2020. The smartphone market grew 19 per cent year-on-year in December 2020 quarter with Xiaomi (including POCO) at numero uno position with 26 per cent market share during the quarter. Samsung ranked second (21 per cent), followed by Vivo (16 per cent), Realme (13 per cent) and Oppo (10 per cent) in the fourth quarter of 2020, according to Counterpoint data.
Micromax, however, is looking at expanding its ecosystem of products with launch of TWS.
"We have smartphones, smart TVs and a host of consumer durables. We will soon launch our TWS and that is a category that is growing at a huge pace. We want to have an ecosystem of smart devices," Sharma said.
India's TWS (True Wireless Stereo, commonly known as earbuds) market clocked its highest-ever growth of 723 per cent year-on-year in the September 2020 quarter, with shipments of about 6 million units, as per Counterpoint data.
