Optiemus to invest ₹300 cr in mobile manufacturing over 3 years
Electronic manufacturing services firm Optiemus plans to invest ₹300 crore in the next 2-3 years in the glass ecosystem and mechanical items related to mobile phone manufacturing in the country, a top official of the company said on Wednesday.
Optiemus is one of the 16 companies to have received approval from the government under a production-linked incentive (PLI) scheme on Tuesday.
"Towards fulfilment of its absolute commitments to enhance value addition, Optiemus has already decided to invest up to ₹300 crore over the next 2-3 years in the glass ecosystem and mechanical items manufacturing especially in areas to support display assembly, back cover, etc," Optiemus Electronics chairman Ashok Gupta said in a statement.
Optiemus has worked with Oppo, OnePlus, LG, HTC, Blackberry, Reliance Jio and Zen to make their devices in its Noida facility.
"This manufacturing activity related to components of handsets will not only help to generate employment and reduce forex (foreign exchange) outflows but at the same time, this will also help reduce India's dependency on China-manufactured components," Gupta said.
He said the PLI approval granted in favour of Optiemus Electronics will definitely go a long way to attract substantial manufacturing business for this company, which is determined and raring to go beyond the Indian market and serve the global market demand as well.
PLI offers an incentive of 4-6 per cent on incremental sales (over base year) of goods under target segments that are manufactured in India to eligible companies, for a period of five years subsequent to the base year (2019-20).
The government has announced that it will create five national champions in the field of mobile phone manufacturing by giving them required support.
"Optiemus is already engaged in active discussions with various stakeholders from this industry and is confident in fulfilling and delivering to the requirements of its customers," Gupta said.
He added that Optiemus plans to build strong design capability and supply chain partnerships in India in the immediate future and emerging as a strong Indian champion.
The government has approved 16 out of 23 proposals from domestic and international firms entailing an investment of ₹11,000 crore under the PLI scheme, to manufacture mobile phones worth ₹10.5 lakh crore over the next five years.
Out of the total production worth ₹10.5 lakh crore in the next five years, around 60 per cent will be contributed by exports of the order of ₹6.5 lakh crore.
The companies include iPhone maker Apple's contract manufacturers Foxconn Hon Hai, Wistron and Pegatron, apart from Samsung and Rising Star.
Apart from Optiemus, domestic companies whose proposals have been approved include Lava, Bhagwati (Micromax), Padget Electronics (Dixon Technologies) and UTL Neolyncs.
Industry body India Cellular and Electronics Association, whose members include Apple, Foxconn, Wistron, Lava, Optiemus, said the approval for Indian companies is a fair hand dealt and each company has got one approval.
ICEA Chairman Pankaj Mohindroo said, "Now, the challenge is: Can these future Indian champions build core design and brand capabilities and also scale up to become globally competitive or some of them use it tactically and fade out with the PLI incentive. A leap in mindset is required and I am sure that once bitten, twice shy, they have learnt their lessons."
MAIT President Nitin Kunkolienker said the new strategy of export-led growth will help create expansion of manufacturing in India and will help to achieve scale.
"This will also help in expanding the value chain of components. Further, this will also enable Indian manufacturers of both finished products and components to participate in global value chains," Kunkolienker said.