DataWind mulls sub Rs 3,000 4G smartphone, to invest Rs 200 crore in two manufacturing units

Monday, Nov 16, 2015

Canada-based lowcost tablet and smartphone maker Datawind is considering a foray into the affordable 4G device segment by mid-2016 and plans to start two new manufacturing facilities with an initial investment of Rs 200 crore in the country.

"We may work on a sub-Rs 3,000-priced 4G-enabled smartphone next as the 4G market matures in India," Datawind chief executive Suneet Singh Tuli told ET, adding that the company is closely watching the telcos' 4G moves.

ndian telcos are banking heavily on surging data consumption to fuel growth. Besides expanding its 3G services, Bharti AirtelBSE 0.58 %, the country's top telecom operator, has launched 4G services, while No. 2 Vodafone India and No. 3 Idea CellularBSE 0.50 % will start their high-speed internet services later this year or in early 2016.

Mukesh Ambani-owned Reliance Jio Infocomm plans to start its 4G services around December.

Datawind shot to fame with an ultra-low-cost Aakash tablet PC debut in 2012 for a governmentbacked initiative aimed at increasing PC penetration among school children in India. The company's market share in India is close to 50% in the sub-Rs 5,000 tablet category, Tuli said, citing various industry findings. US-based research firm IDC puts Datawind at the third spot, closely behind leader iBall and Samsung, with a share of 13.5% in the overall tablet market in the second quarter of 2015.Datawind is also teaming up with Reliance CommunicationsBSE 1.66 % to launch the world's most affordable smartphone — priced at Rs 999 — by the end of this year.

Tuli said Datawind may talk to both Airtel and Jio for affordablypriced smartphones for device bundling, but feels that it may take at least a year for India's LTE market to grow. He added that mid-2016 would be the right time for the company to introduce 4G-enabled smartphones in the country.

Swipe Technologies recently launched 4G smartphone, Elite 2, at Rs 4,666. The most affordable 4G-enabled smartphones available today include Micromax Yu Yunique, priced at Rs 4,999, Lenovo A2010 at Rs 4,990, ZTE Blade Q Lux 4G at Rs 4,999 and Phicomm Energy 653 at Rs 4,999. Datawind is investing Rs 200 crore to put up two new manufacturing facilities in India by early 2016, where each unit will have a production capacity of 5,000 units a day. It currently manufactures primarily touch panel at its plant in Amritsar, Punjab.

In 2014, the company had raised funds from an initial public offering (IPO) at Toronto Stock Exchange (TSX). "We have recently raised Rs 180 crore from the Toronto Stock Exchange and have additional lines of credit and, therefore, we are well poised to start manufacturing in the next six months," Tuli said.

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