As per correspondent from Mumbai Seven years old mobile phone maker, Micromax has crossed Rs 10,000 crore in annual revenues during year to March 2015, and is now within striking distance of one of the world’s largest consumer electronics brand Sony in the Indian market.
Micromax Informatics grew sales by a whopping 47% in 2014-15 to Rs 10,450 crore, while Sony’s Indian unit grew its business 10% with revenue at Rs 11,010 crore, according to their annual return filed with the Registrar of Companies (RoC). Two years ago, Micromax was not even half of Sony in turnover. Industry watchers feel Micromax can potentially edge out Sony this fiscal on the back of online and 4G smartphones business, even as Sony is restructuring its smartphone business by exiting sub-Rs 10,000 segment which will impact growth. Lack of any sporting event which catalyzes television sales during the year could impact Sony further.
“Despite smartphone being a bigger market in India as compared to television, its growth rate is high too. Micromax will continue to grow at high double digit pace which might be a challenge for Sony this year,” said the chief executive with a leading retail chain, requesting anonymity.
While Micromax declined to share growth projections, its chief executive officer Vineet Taneja said growth drivers last fiscal were both smartphone and LED television business, which will continue this year as well.
“In smartphones, the growth during the second half will be driven by 4G models which now account for 30% of our portfolio with 20 models and will be further strengthened. We also have around 10% share in LED televisions, which will continue to grow,” Taneja said.
Sony India, however, said growth was impacted due to its global exit from Vaio laptop business.
“On a like-to-like basis without the laptop portfolio, our sales growth rate was 22%. However, this year we expect sales growth may come down due to absence of any major sporting event like last year which drives television sales,” said Sony India’s sales head Satish Padmanabhan. Padmanabhan also clarified that the exit from entry level smartphones too is a global strategic decision which has in fact doubled Sony’s average selling price in India. “However, the Indian smartphone market has off-late become extremely competitive and difficult with entry of so many brands. We are carefully monitoring it,” he said. As per Counterpoint Research, while Micromax has increased sales from online, it is now facing pressure in $50-100 price segment from Intex, Lava and others. However, its Yu brand alone is now selling more smartphones than Xiaomi online, it said. Micromax ‘s Taneja seems aware. “If we have to grow at this pace, we have to gain share which we will continue to strive, but will also not do anything for short-term benefit which several of the brands are now doing,” he said. While Micromax ventured into cellphone business in 2008 and in smartphones in 2011, its entry into LED television was as recent as two years ago.