Start-up Island. Being hard at hardware has paid off for this pioneer

While ‘Make in India’ has been generating positive sentiment across sectors that needed a boost, the computer hardware manufacturing sector has for long struggled. Through taxes and other burdensome requisites, and a tidal wave of interest in software and services, not all hardware businesses have done badly for themselves.

And ‘doing well’ may, at least in the initial run, have more to do with persistence than profit-making. Om Nanotech has exemplified this over eight years, and is looking at expanding its capabilities with the hope that initiatives like ‘Make in India’ make a concrete difference. Set in the Noida Special Economic Zone, Om Nanotech brought “testing of DRAM IC and Flash for the first time to India” and identifies itself as “probably the only Indian brand in the computer memory market available all over the world”.

The company’s initial challenges had to do with the reality that India was short of expertise in the area of testing. So engineers from Taiwan were hired. “We had to make our product popular in the international market, but also teach our Taiwanese employees to do what they do even better,” quips Atul Khosla, Director, Om Nanotech.

The parent firm OM Associates was at first outsourcing testing and manufacturing to contract facilities in the Far East, but went on to move much of that activity into its own captive facility in India. Making in India, then, was already happening in some quarters with an unwavering focus. Skill shortages continue to be a challenge. To remain a strong player, Om Nanotech has had to train talent for the business over the years, often sourcing them right after Plus 2. “We find the quality of education in certain fields going down. It leads to hardware engineers not being well-versed with the basics. Obviously, this means they can’t command good salaries, which means they will turn to other sectors for better pay. And for some time now there has been less enthusiasm over jobs in the manufacturing sector,” Khosla shares. Om Nanotech has had to take on interns, many of whom reportedly stay with the company for an average of three years, and in any case are employable by local ITIs and other companies.

Some 300 employees work out of Om Nanotech’s facility in Noida. From meeting operational costs to paying taxes to ensuring more specific talent floods the market, the hardware manufacturer hasn’t had a smooth ride.

Although recent measures by the Central government, especially the ‘Make in India’ campaign, are likely to bring relief to the sector, businesses still need to ensure sound business models to take them through phases of uncertainties. Om Nanotech takes on original manufacturing for brands like Zipmem (pen drives), Dolgix and Qumem (memory modules).

It also has its own range of products. With customers in more than 20 countries, 70 per cent of its revenues come from the overseas market. It is reportedly growing at 65 per cent CAGR, having seen highs of ₹250 crore revenues in 2010. “We have to take advantage of the credibility we’ve built up in the market. We’ll look at how to bring larger brands into India and explore selling their products through our channels,” reveals Khosla.

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