Xiaomi bets big on India, invests Rs 3,500 crore in two tranches
BusinessToday.In March 18, 2019
Xiaomi is betting big in India and is going all out to maintain its leadership position with an investment of Rs 3,500 crore into its Indian business unit. Xiaomi entered the Indian market four years ago and has invested the money into Xiaomi Technology India in two tranches.
According to a report by ET, the amount was invested in two tranches this year - Rs 1,500 crore on January 17 and Rs 2,000 crore on March 1. It is reportedly the highest amount invested by Xiaomi in India since it started its operations in the country.
After dominating the smartphones market, Xiaomi is planning to enter the white goods sector in India. Xiaomi also sells water purifiers, washing machines, laptops, refrigerators and other smart equipments. The funds would go into the expansion of Xiaomi's product line and its Mi Home retail stores to stay ahead of the competition in the Indian market. The company has already planned to introduce its foldable phone in India as early as April or June this year. The phone is very competitively priced at Rs 74,999.
India's smartphone market is currently a key battleground for both Xiaomi and Samsung. Samsung India has upped the ante and has introduced several new reasonably priced smartphones in an attempt to take the top spot back from Xiaomi. Xiaomi India too has let go off its conservative strategy in India with the latest round of investment.
The current investment has been made by the Xiaomi Singapore Pte Ltd, which owns 99.9% of the Indian entity - the balance 0.1% is owned by Xiaomi HK Ltd, which did not make any fresh investment. According to the Economic Times, under the first transaction in January, 3,786 shares of Xiaomi Technology India were offered to the holding company at a premium on a rights basis, while for the second one, in March, 6,959 shares were allotted.
According to Counterpoint Research, Xiaomi was the leader in the Indian smartphone market with 28% market share in 2018. On the other hand, Samsung, Vivo and Oppo had a market share of 24%, 10% and 8%, respectively in 2018.
Edited By: Udit Verma