“A Nano in every handset segment”

Lemon Mobiles, one of the new handset players in the Indian market, is looking to garner 6-7% of the handset marketshare in the next three years, targeting 7 million handsets of an approximate 100 million handset market. For this, the company will look to make $100 million investment, including an investment in its own handset manufacturing facility in India. Responding to MediaNama’s question on how they intend to fund the investment, IB Mehra, Executive advisor, Fastrack Communications, was evasive, saying that they could look at all forms of investment, not ruling out private equity placement (though he said that PE players tend to lookto exit quickly), investments from its promoters, or even a listing.

Lemon will use the money raised to expand operations within India, and also launch its brand of handsets in other emerging markets, including Latin America, South East Asia and Africa. In India, Mehra said, a lot hinges on being able to meet their target of garnering 10% of handset retail shelf space.

The manufacturing facility in India will initially assemble handsets and later seek to manufacture them, given incentives to local manufacturing from the Indian government, and the need to derisk imports of handsets from China. Lemon (Fastrack Communications) expects that the facility will account for 20% of its total volumes by the end of 3 years, and will also be used to develop its GPS devices, apart from handsets.

Additionally, the company has plans to introduce 3G handsets in the Indian market, across segments, covering entry level, mid and high-end segments.

Handset Plans

Mehra said that India is a price driven market, so their handset offerings will be value driven; drawing parallels with the TATA Nano, the affordable, albeit low-on-features car from Tata Motors, he said that the idea is to create “A Nano in every handset segment”.

And that’s what Lemon appears to be doing with its handsets – the iQ505 handset that was launched yesterday is a QWERTY handset without GPS, but with several applications on board; trying it out, I found it unnervingly slow and tedious to use, with the interface rather grainy; Would I buy it? No. But priced as low as Rs. 3800, it certainly does appear to be value for money, and I think there is a market that will choose a handset with better features for the same price point.

First Dual SIM Android Device: P1

Mehra said that the company plans to introduce an Android device in the Indian market, which will be the first Dual SIM Android phone, with push email, called the P1, for professionals. He didn’t put a timeline on the launch, but said that the pricing of the device will be in like with their value for money philosophy; it will be the fastest (in terms of processing speed) from the Lemon stable yet. Lemon is also planning to launch Windows mobile devices.