Home-grown handset vendor Intex Technologies is planning a cap-ex of ₹1,000 crore over a five-year-period towards ramping up its smart-phone manufacturing unit at Noida, UP. Investments will be through internal resources.
The unit, which went on stream earlier in June this year, has a current capacity of 100,000 units a month. Around ₹100-150 crore has gone towards setting it up.Capacity addition
According to Deepak Kabu, DGM, Intex, the manufacturing capacity will be ramped up to 15 lakh a month, by the end of this fiscal.
“We’ll be investing ₹1,000 crore over a five-year-period especially in the smart-phone unit,” he told BusinessLine .
Intex sells around 18 lakh mobile phones a month (as on May) of which 6 lakh are smart-phones. Approximately, 8.25 lakh units (smart-phones) are imported from Shenzhen in China, on a monthly basis.
The Noida facility, Kabu pointed out, will in the initial days, act as an assembling unit. Once the ecosystem for smart-phone manufacturing components come in, focus dependence on imports will go down. “At least in another year we will start work on the ecosystem,” he added.
Apart from the Noida unit, the Delhi-based company has three more manufacturing facilities; two in Jammu which cater to UPS and speakers and one in Baddi that caters to feature phones.
According to Kabu, setting up its own facility will help the company boost its top-line.Duty reduction
This apart, the import duty reduction coming up as a result of having its own manufacturing will ultimately be passed on the end-consumer leading in the form of pricing benefits of around 5 per cent.
A major brand-building boost is also expected; with marketing spends being near doubled to ₹250 crore for this fiscal. Last year marketing spends were to the tune of ₹130 crore.
Intex, he said, hopes to see total sales (from the mobile phone division) jump by three times to ₹7,500 crore for FY16, as compared to the ₹2,850 crore it reported in the year ago period.
The handset vendor will also be putting a special thrust on the Southern markets.
With just 15 per cent of its total sales coming from the five southern states, the company is roping in a number of regional stars. The idea is to double the market share over the next one year.
Currently, North India remains its highest selling region with 40 per cent; followed by 30 per cent from the West. Eastern markets contribute the remaining 15 per cent.