Jivi Mobiles to invest Rs.200 cr on new manufacturing unit

The Dollar Business Bureau

Jivi Mobiles is planning to invest around Rs.200 crore in establishing a manufacturing plant in Lonavala having a capacity to produce 5 lakh mobiles each month. Currently, it sells roughly around 3-3.5 lakh mobile phones per month and expects to sell more than 6 lakh phones a month.

The Indian mobile manufacturer aims to sell over 10 lakh phones a month by next financial year. To achieve this target, the company is going to set up a new manufacturing plant in Lonavala with an investment of Rs.180-200 crore, according to Pankaj Anand, CEO of Jivi Mobiles.

At present, the company has its mobile assembly unit in New Delhi where it manufactures 3-3.5 lakh mobile phones a month. Without opting for a contract manufacturer, Jivi had started its own manufacturing unit in New Delhi with an investment of Rs.150 crore to produce quality phones, Anand said.

Speaking about Delhi Chief Minister’s announcement of increasing the minimum wages to Rs.14,500, he said this will negatively impact their business which has very low margins. While importing the spare parts, the average concession is around Rs.35 only. This minimum wage mandate will hamper growth prospects in Delhi Pankaj said, a reason for the company's expansion plans to Lonavala.

As per Jivi Mobiles Director Gurdeep Singh, the mobile phone company will hire 500 skilled persons to work in the new manufacturing unit at Lonavala, which will have around 10 assembly lines. It will use 1-2 assembly lines for mobile phone accessories such as battery and charger. The new plant is likely to make more than 30,000 mobile batteries and around 20,000 chargers in a month.

Jivi Mobiles also plans to foray into affordable smartphone segment to deliver 3G and 4G handsets. The company would like to bring smartphones at a cost of Rs.2,000-5,000 as the Chinese manufacturers are aggressively competing with Indian companies in the smartphone segment priced over Rs.5,000 per unit, Anand said.

The company is concentrating on offline retail outlets and has presence in more than 25,000 retail stores across the country. It will soon double its distributor network from 550 to 1,000 and sell its handsets from around 40,000 retail outlets. Jivi also sells 50,000 feature phones a month in the US market and 25,000 phones a month in Nepal. The company is in talks to expand its presence in Bangladesh, Sri Lanka and Myanmar.