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This Indian brand has the best chance against Chinese phone makers, according to experts

Lava claims to have over 15 percent market share in the feature phone segment.

By Sai Krishna -

Published On: July 3, 2020

Highlights

Indian brands like Micromax, Karbonn, and Lava are expected to launch phones in India in the sub-Rs 10,000 price segment
Lava International is slightly ahead in terms of design and seems to have some momentum in the market, analysts say
The company has already announced a Rs 800 crore investment for the Indian market, which will be executed over the next 5 years

India-based smartphone makers Micromax, Karbonn, and Lava are planning to re-enter the competitive smartphone market that is being dominated by brands like Xiaomi, Realme, Samsung, and others. Micromax plans to launch phones in the sub Rs 10,000 price segment. However, market analysts predict the on-going anti-China sentiment won't bring the expected gains to the Indian players as their journey will be full of challenges. The home-bred brands will have to invest in product innovation and intellectual property in order to tackle the competition.

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Also read: Here's the full list of all 'made' in India smartphones

Among the other local brands, Lava International is slightly ahead in terms of design and seems to have some momentum in the market. The company is said to be planning to shift its exports manufacturing base, R&D, and design from China to India this year and will invest Rs 80 crores for the transition. It will invest a total of Rs 800 crore over the next five years towards this transition. Both Lava and Karbonn confirmed their respective plans to leverage the Indian government's recently announced schemes, especially the PLI (performance-linked investment) scheme. Back in September 2019, Lava bagged a multi-crore deal from US conglomerate General Electric to manufacture hand-held devices meant specifically for medical use.

According to Counterpoint Research, local brands' market share in India stood at 1 percent, compared to 81 percent share of Chinese brands in the January-March period. Tarun Pathak, associate director, Counterpoint Research told the Economic Times that R&D is one of the main areas where local brands need to improve to further grow. "The hardware will be commoditised and they need to find ways to monetize the same and stay profitable which means they will need to look outside just the entry-level users and look at differentiation from software level as well," Pathak said.

Also read: What the Indian market looks like without Xiaomi, Realme, OnePlus, and other Chinese brands

Navkendar Singh, Research Director at IDC, was quoted as saying: "They need better support from the Indian government like incentives or cheaper funds under some scheme. Else, there is no way they can compete with China-based brands in terms of marketing and channel spends."

For brands to fully make in India, it is not logically possible since companies will have to set up chains from displays and chips to cables in the country. Karbonn already sells 8 lakh to 10 lakh feature phones in India, while Lava claims to have over 15 percent market share in the feature phone segment.

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