The Hindu Business Line : ZTE to ramp up presence in Indian telecom market

Shenzhen, July 16 Amid intensifying competition in the telecom space, Chinese equipment vendor ZTE Corporation is aiming to step up its India exposure and hopes to clock a turnover of $1 billion from its operations in the country this year, up from $750 million last year.

In order to bolster sales in the Indian market, the company, which is China’s largest listed telecom equipment provider, is exploring the possibility of directly marketing low-cost handsets under its own brand. “If we feel that the timing is right, we could directly sell low-cost ZTE handsets in the Indian market by as early as this year-end,” ZTE Corporation’s Executive Vice-President, Mr He Shiyou, told visiting Indian journalists.

The company has been selling handsets only in partnership with mobile operators both in GSM and CDMA categories. He said the Shenzhen-headquartered company would focus on the low-end segment and expect volumes to drive growth.

ZTE is looking to manufacture 50 million handsets in 2008 (up from 30 million in 2007) and supply over 15 million of these to India (as against 10 million last year). The company’s expansion strategy focuses on increased tie-ups with mainstream CDMA and GSM network operators, besides selling broadband, WiMAX and IPTV solutions.

Despite plans for increasing its market presence in India, Mr He clarified that the company does not have any immediate plans to set up a manufacturing facility in India in view of the comparative cost advantage in China. “Cost of manufacturing is still high in India as compared to the option of importing equipment from China. Sales (in India) have to come up to a minimum level before we can think of setting up a plant in India,” Mr He said.

Asked whether ZTE will be bidding for the 90-million GSM lines expansion plan announced by State-owned Bharat Sanchar Nigam Ltd (BSNL), ZTE executives said the company has already initiated the process and assured to put in its bid for BSNL’s tender.

The company, listed on the Shanghai and Hong Kong stock exchanges, is keenly exploring market developments in India, including the rollout of 3G services to explore equipment supply tie-ups with prospective operators. The firm, which has largely remained focussed on the CDMA handset space in India, is now in talks with GSM licensees for product offerings and network expansion, ZTE’s Director for International Marketing, Mr Richun Wu said. (ZTE had sponsored this correspondent’s trip to China)

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