Today Micromax, India’s second largest seller of smartphones in that country behind Samsung, announced that they are making plans to begin selling smartphones in China during 2017 and that they were considering going public by 2018. The company has ambitions to become the fifth largest smartphone maker in the world by 2020.
This is a very high target for the company to set. Currently, Micromax is in a slippery position even on their home turf of India as Samsung and a small army of entry-level Chinese smartphone makers are gobbling up the market. Breaking new ground in China may seem like a natural move, but the smartphone market worldwide is cooling, and China is no exception. Micromax will be entering a fiercely competitive marketplace that doesn’t appear to be experiencing significant growth in the near future. They will also be going toe-to-toe with the current fifth largest smartphone maker Vivo. The Chinese company sells upwards of four million phones every month while Micromax only moves around 1 million.
What’s more is that the company will need a substantial influx of cash to make these dreams a reality. They are reaching out to private investors and considering a public offering. They want to use these funds to acquire companies that will help them build a network of services that will hopefully make them shine against a backdrop of similar competitors.
“I’m not sure why they’re doing this,” said IDC analyst Kiranjeet Kaur. “The Chinese market is not growing and it’s really competitive. I don’t know how they will survive there.” Micromax has recently been expanding in other ways, moving into Nepal and rising as the third-largest smartphone maker in Russia. However, the Chinese market is a different animal altogether, one in which even Apple is struggling.
What are your thoughts regarding Micromax’s ambitions to become the fifth largest smartphone maker in the world by 2020? Is this a pipe dream, or could they be a dark horse on the rise? Give us your opinion in the comments below!