Micromax readies itself to play Chinese whispers

India’s second largest mobile-phone maker Micromax wants to enter the Chinese market to boost its sales and global presence. A bold move.

Micromax co-founders (L-R) Sumeet Kumar, Rajesh Agarwal, Vikas Jain and Rahul Sharma unveil their new logo in Gurgaon, on April 13, 2016. Photo: IANS

Three out of top five global mobile-phone sellers are Chinese companies. Now, India’s second largest mobile-phone maker Micromax wants to enter the Chinese market to boost its sales and global presence. A bold move.

Companies like Huawei, Oppo and Xiaomi rank among the top phone makers in the world. There are two similarities between these three. One, they are Chinese companies. Second, they are leading mobile phone sellers in China as well.

Moreover, their market share in India is also on the upswing with Xiaomi constantly keeping other companies on their toes, including Micromax.

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Globally, too, while Samsung and Apple lead at first and second spot, Huawei, Oppo and Xiaomi follow in terms of worldwide smartphone sales in Q1 2016, according to a Gartner report.

Huawei’s market share was at 8.3% during January-March quarter with sales of 28.8 million units.

Oppo saw a nearly 150% growth with its sales of 16.1 million units in Q1, followed by Xiaomi with a 4.3% market-share globally in Q1 with sales of 15 million units.

In comparison, Micromax is at 14th spot in global standings for smartphone sales in Q1 2016, according to Counterpoint Research and at a ‘slightly better’ 11th spot globally due to large feature phone sales in India.

Moreover, it is the cheap smartphone market that is currently seeing sales. A recent report said that nearly 50% of smartphone sales in India happen at a price point of under Rs 8000 per phone.

The feature phone market, too, is growing at a healthy 30% year on year.

Micromax has seen certain drubbing by a host of Indian companies in the recent past including Lava and Intex.

The company is fighting hard maintain its position in the Indian market.

Now, Micromax, which is already third largest phone seller in Russia, wants to enter Chinese market.

In a recent interview, on our YouTube channel, the company said it plans to be a consumer durable company. This means that Micromax is looking at its next wave of growth to come from sales of television, refrigerator, etc.

But will this Apple-esque move be enough or is Micromax spreading itself too thin?

The recent top-level in the company do point at the nervousness of losing its position.

What should be the strategy in such times, to diversify into new markets or geographies or to consolidate your position in area that you know best?

While Micromax might think that be getting a small part of the Chinese market might raise its share globally, it might just end up losing its share in the Indian market too.

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