coolpad

Coolpad, a China-based smartphone manufacturer, is planning to enter the Indian market with its own brand of phones and plans to set up and R&D facility in the country. According to an ET report, the company will invest up to $300 million for this.

This will include plans to set up an R&D facility post which the company plans to manufacture phones in the country as well. Coolpad mentions that it will focus on selling 4G phones that cost less than Rs 10,000 on online marketplaces. Interestingly, according to a Firstpost report, the company will invest only Rs 30 crore in R&D and design in the country and will partner with Videocon to manufacture its smartphones from its facility in Maharashtra.

The same report mentions that as of now Coolpad has revenues of nearly $3 billion. Given this, it seems unlikely that the company will spend 10% of it on manufacturing in India alone. We presume some of the $300 million will go toward R&D (perhaps around Rs 30 crore?), with the rest invested in partnerships (like the one with Videocon) and marketing activities etc. We have written to Coolpad to resolve this ambiguity, and will update when we receive a response.

Electronics manufacturing in India: The Indian government has been encouraging domestic companies to start manufacturing electronics goods within the country instead of importing them and had approved a National Policy on Electronics. The National Manufacturing Competitiveness Council (NMCC) had also proposed the creation of a $1 billion fund to encourage telecom equipment manufacturing in India. The Cabinet had approved the setting up of two semiconductor wafer fabrication units at a cost of Rs 63,412 crore in India, in February last year.

Since then, various smartphone manufacturers have said they will start manufacturing in India or have already started doing so:

– Earlier this month, electronics manufacturer Intex said it was planning a Rs 1,000 crore smartphone manufacturing facility in Greater Noida. According to the company, the facility would be spread over 20 lakh square feet area and be developed in the next three years.

– In August, Videocon said that it started manufacturing mobile phones in the country with the smartphone Z55 Dash, a handset it claims to have been designed in India as well.

– The same month, Lenovo started the local production of smartphones with Flextronics under a contract manufacturing deal at its Sriperumbudur plant. As of now, the facility is making Lenovo-owned Motorola’s Moto E smartphones and will starting making the K3 Note smartphone soon.

– In June, homegrown mobile phone maker Celkon opened its first manufacturing unit in the country in Telangana. The company mentioned that about 60% of the phones manufactured at this plant would be feature phones and the remaining 40% would be smartphones.

– The same month, Taiwanese electronics contract manufacturing company Foxconn said that it would start making Xiaomi phones in Andhra Pradesh, although it’s not clear when Foxconn plans to start making Xiaomi phones at this factory.

– In May, Chinese smartphone maker OPPO revealed plans of setting up a handset manufacturing unit in India by August to primarily tend to the domestic market. The company also mentioned that some of devices manufactured here would also be exported to overseas markets.

– In April, Chinese handset maker Gionee said that it would set up a manufacturing facility in India within 2018. The company claims it will invest Rs 300 crore to set up this plant, which would manufacture devices for India, the SAARC countries and Nigeria.

– In March, Samsung and Sony had announced plans for setting up manufacturing bases in India as a part of the Make in India initiative. Samsung reportedly would invest as much as $500 million to $1 billion in the manufacturing unit that will produce smartphones and tablets for the company.

– Earlier this year, Spice Group had said it would invest Rs 500 crores to set up a manufacturing unit in Uttar Pradesh. The company had also signed a Memorandum of Understanding (MoU) with the Government of Uttar Pradesh for the same, as per which the UP Government would support Spice in establishing the facility by providing the necessary infrastructure, ecosystem and incentives under various schemes.

– In January, smartphone maker Samsung Electronics revealed that it had invested Rs 517 crore towards the expansion of its mobile phone plant in Noida, Uttar Pradesh, under the UP Mega Policy. Subsequently, the company reported that it would invest as much as $500 million to $1 billion in the manufacturing unit that will produce smartphones and tablets for the company.

– Sony too wants in on the action: at the MWC in Barcelona this year, Kenichiro Hibi, the head of Sony’s India operations, said that the company was planning to launch an Indian manufacturing unit ‘very soon’. He mentioned that while final decisions have not been made yet, the company would look to manufacture both flat-panel televisions and smartphones in the country.

– In April last year, mobile phone manufacturer Micromax also started manufacturing devices in the country at its Rudrapur plant. Previously, the company imported devices from China where it had tie-ups with manufacturers such as Foxconn.