Micromax, Lava, and Karbonn were popular names in the Indian smartphone market which enjoyed a market share of 45 percent during their peak in 2013 and 2014. However, with the entry of Chinese brands like Xiaomi, OPPO, Vivo, the Indian makers soon lost their way in the country.
As per the latest development, Micromax, Lava, and Karbonn will be targeting the low-budget and mid-range price segments. Due to government pressure, Chinese brands have already moved away from the affordable segment and are launching expensive phones above the Rs 10,000 price bracket. Very few smartphones like the Redmi A2 and Infinix Smart 7 are available under Rs 8,000 segment. This provides a solid opportunity for Indian brands to make a comeback and win the trust of consumers as well as some market share.
Brands like Micromax, Lava, and Karbonn believe that consumers don’t have any choice in the entry-level price forcing them to buy refurbished phones, on finance schemes, or pause their plan to buy smartphones. Karbonn is planning to launch a smartphone at Rs 4,999 whereas Micromax could announce a new device at Rs 5,999. However, this could be bundled with telecom carriers like Jio and Airtel. Lava is reportedly planning to launch more 5G smartphones at sub-Rs 10,000.
Measures by India Govt
India has the potential to become a global hub for components manufacturing due to the availability of cost-effective skilled manpower, fast improving infrastructure and the Government’s push for Ease of Doing Business in the country. The size of Indian electronic components market has increased at a CAGR of 32% to $20.8 bn in 2018-19. Moreover, the market opportunity for electronic components in India is expected to be around $200 bn by 2025.
The Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) aims to strengthen the manufacturing ecosystem for electronic components and semiconductors. Target manufacturing of electronic components and semiconductors through the scheme will help meet domestic demand, increase value addition, and promote employment opportunities in this sector.
Domestic electronics manufacturing has increased substantially over the last few years and is steadily moving from Semi Knocked Down (SKD) to Completely Knocked Down (CKD) level of manufacturing. However, domestic value addition continues to be low in the range of 10 – 30% only. This is due to the lack of electronic components manufacturing ecosystem, near absence of semiconductor manufacturing ecosystem and absence of display manufacturing ecosystem in the country.
Our Perception
We feel that this measure is a strategy adopted by the government to boost growth of domestic electronics manufacturing over the years has been observed that the major growth has occurred on account of assembly of finished products from imported electronic components/ sub-assemblies/ parts, mainly catering to the domestic demand.
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