Mulling third manufacturing plant in India, says Xiaomi

New unit to make fitness bands, power banks, routers

Updated - June 07, 2017 10:26 pm IST

Published - June 07, 2017 09:17 pm IST - CHENNAI

The Indian arm of Chinese handset maker Xiaomi Technology India Pvt. Ltd. may soon start exploring the possibility of setting up its third manufacturing plant in India, said a top official.

“Right now, we are producing one phone per second at two manufacturing facilities of Foxconn in Sri City, Andhra Pradesh, and we have to ramp it up further,” said Manu Kumar Jain, managing director, Xiaomi India.

“We have not yet decided on the third plant. Going by the growth rate, we have to think about the third manufacturing unit. We have to talk to our partners and to a few state governments including Andhra Pradesh. The first two plants are making only handsets. The new unit would produce fitness bands, power banks, air compressors and routers, among other things,” Mr. Jain said.

Explaining the rationale behind the move, he said in the quarter ended March 2017, Xiaomi sold 3.8-3.9 million phones compared with one million phones in the corresponding quarter of the previous year.

Eyes doubling revenue

Last year, Xiaomi India clocked sales income of $1 billion with 150 people and this year, it aspires to touch $2 billion with 225 people.

“It is not a sales target... We are already a leader in the online segment with 41% market share and we rank second in combined sales with 14% market share. We are doubling efforts in India to become the top seller,” Mr. Jain said.

Mr. Jain said online sales accounted for 90% of Xiaomi sales revenue. By the year end, he said, the company aims to raise offline sales revenue to 25% and to 50% over the next few years.

On the Mi-branded power banks, he said: “We are number one in sales. In fact, the second slot is occupied by fake products sold by thousands of sellers under the Xiaomi brand. Legal action is being initiated as and when it comes to our notice.”

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