Vivo, the Chinese smartphone maker, is reportedly planning to open one of India's largest mobile phone manufacturing facilities in the coming month. With an investment of over Rs 3,000 crore, this new plant will have the capacity to produce 120 million devices every year.
According to a report by the Economic Times, the company is also in search of an Indian joint venture (JV) partner to manage its manufacturing operations. The company was earlier engaged in talks with the Tata Group, the Murugappa Group, and Indian contract manufacturer Dixon Technologies for forming a JV. However, these talks have not been successful due to disagreements over valuation.
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"Vivo is keen on having a strong Indian partner for its operations. While nothing has been finalised so far around the JV, talks are on with a few stakeholders," sources cited in the report stated.
Vivo has moved out of its old leased manufacturing unit, which had an annual capacity of 40 million devices. As for now, Micromax Informatics' manufacturing unit, Bhagwati Enterprises, has taken over that space.
The company's new manufacturing facility in Greater Noida spans 170 acres and is quite similar to Samsung's largest mobile phone manufacturing plant in India which has an annual capacity of 120 million devices.
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Sources cited in the report also said that the leading smartphone brand in India had been in discussions with several Indian companies in the past months. However, no deal was reached due to disagreements over various aspects like valuation, management control, and other issues.
"The valuation of the company has to be decided by a third party, like the big four accounting firms. There can't be distress sale of stake as the company has invested a substantial amount in the Indian market so far," one of the sources added.
The government wants Chinese smartphone brands to team up with Indian companies through JVs. However, it has reassured the companies that their past investments in India won't be at risk if they don't form such partnerships.
