Micromax is in no mood to slow down, and it’s amazing yet historical upswing continues to soar, despite entry of several Chinese and Taiwanese phone vendors in the Indian market.
At a recent launch of Canvas Spark, Micromax CEO Vineet Taneja shared some interesting numbers with TeleAnalysis team, as he said, “Though our books audit is not complete yet for the last FY, our revenue has already crossed Rs 10,000 crore”
During the financial year 2013-14, Micromax reported revenues of Rs 7200 crore, which means that during 2014-15, their revenues rose 39%!
During the last quarter of 2014 (October-December), we had reported that Micromax has dethroned Samsung to become India’s largest phone vendor. During that period, Micromax sold 4.6 million units, thereby capturing 22% of the overall Indian market, compared to Samsung which sold 4.4 million units, thereby capturing 20% market share.
Mass Market Phones: The Success Recipe of Micromax
As per Vineet, low cost mass market phones were the leading cause of Micromax’s massive success in India. He shared that last year, Micromax sold 10 million (1 crore) mass market phones, which were priced between Rs 3000 to Rs 5000, thereby indicating that there is a massive shift going on from feature phones to smartphones.
And Micromax has effectively captured this market with near perfection.
With an average selling price (ASP) of a mass market phone pegged at Rs 4000, Vineet claims that “Close to 60% of the smartphones sales come from mass market category and this share is growing each passing day”
Interestingly, during the last quarter of 2014, 23% of all smartphones sold in India were priced below $100; and 41% of all smartphones were between the range of $100-$200, which perfectly fits the scenario presented by Micromax.
Overall, Micromax was able to sell around 33 million smart phones in 2014, with feature phones contributing 18-19 million units and 13-14 million smartphones.
In February, when Micromax launched specially packaged feature phones for Rs 699, we had apprehensions that this is a crucial market for them. With the sales figure shared by Vineet, it seems that feature phones are indeed important for them.
Venture Capital Hunt Now?
Considering the incredible growth which Micromax is experiencing right now, they are also looking for venture capital funds. As per a report, Micromax is in talks with SoftBank to sell 20% stake at a valuation of $3-5 billion (Rs 18,000 – Rs 30,000 crore). They also have plans for IPO launch, details of which are currently not available.
Comparably, Xiaomi, a major competitor of Micromax in India is valued at $46 billion (Rs 2,76,000 crore), making them World’s most valuable technology start-up.
None the less, Micromax has adapted a very interesting business model for their expansion in India, as they have also started manufacturing of some of their units and assembles the high end smartphones imported from China and Korea. Here are some interesting arguments about their success story in India.
Targeting the mass market segment with low cost smartphones and even lower cost feature phones, Micromax is well on its way to become Xiaomi of India!
