LG Electronics on Thursday became the latest firm to start manufacturing mobile phones in India, as the South Korean company aims to increase its market share and take advantage of the excise duty benefit offered to handsets made and sold in India.
The devices—K7 and K10— priced at R9,500 and R13,500 respectively, were launched by telecom minister Ravi Shankar Prasad who said it was an occasion of personal satisfaction for him to see companies setting up base in India for electronics manufacturing.
“India is a strategic market for LG globally and the decision to manufacture smartphones in India underscores our commitment to our customers here. We want to tap the huge potential for smartphones in the country and the K-series will be the first ones to be manufactured in India,” said Kim Ki-Wan, managing director, LG Electronics India.
The move comes at a time when competition has increased in the market due to the entry of Chinese handset companies who sell mobile phones with high-end technology.
India is the only brightest spot for smartphone companies during the current year with sales of handsets expected to grow at 29%, while the global growth is estimated to be at about 7% to reach 1.9 billion units, according to Gartner Inc, a global technology research firm.
During 2015, manufacturers such as Samsung Electronics, Foxconn, and Micromax Informatics made and sold more than 100 million smartphones within the country.
Total capacity 24.5 million per month
Projected to go up 50 million per month
Smartphone penetration 220 million users*
Expected growth 29% Growth on Year#
Current major phone players: Samsung India, Micromax, Foxconn, Flextronics
Expected players: Lenovo, Motorola, Micromax, Xiaomi, Gionee
*CounterPoint Research #Gartner Inc