Chinese phone component maker Holitech Technology Company will invest Rs 1,400 crore ($200 m) to set up a facility to manufacture five key components that go into a smartphone. The components will exclusively be manufactured for Xiaomi India. In the first phase, Holitech will invest Rs 700 crore in a 75-acre plot allotted by the Andhra Pradesh government at Tirupati.

The facility would have the capacity to produce 50 million components in each of the five categories in the first phase. The second phase would double its capacity.

The facility will manufacture Compact Camera Modules (CCM), Thin Film Transistors (TFT), Capacitive Touch Screen modules (CTP), Flexible Printed Circuits (FPC), and fingerprint sensors.

“The facility will start production in January. We are expecting to generate revenues of $1 billion. We will invest $100 million in the second phase. The two phases will be completed in three years,” Flame Chen, Chief Executive Officer of Holitech Technology, has said.

The Chinese firm has a revenue base of $4 billion. It signed an agreement with the Andhra Pradesh government on Monday. This is the first overseas facility for the Chinese company.

“This is one of the 50 companies that we invited early this year to explore manufacturing opportunities in India. The Holitech facility will manufacture components exclusively for us. It will generate about 6,000 jobs,” Manu Jain, Managing Director of Xiaomi India, said.

The phone maker has six (third-party) factories to produce phones and another for making power banks. Manu Jain said Holitech’s facility would help reduce the import of components that go into a phone. “Our aim is to source the phone components locally. It may not reach 100 per cent, but it can get as close as it can get to 100 per cent,” he said.

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