Failed to match pricing offered by Chinese firms: Micromax's Rahul Sharma

Once the poster boy of India’s handsets industry, Micromax Informatics was blown out of the market in 2017 by Chinese brands. After nearly three years, the firm is planning a comeback into the local market with a brand new identity and a comprehensive strategy to regain lost ground. Rahul Sharma, co-founder of Micromax, shares his comeback plan in a candid chat with Arnab Dutta. Edited excerpts:
 

After bowing out a few years ago, Micromax is coming back into the smartphones market. Why now?
 

We are coming back into the market because this is need of the hour. Markets across the world are now looking for products that are not made in China. And, I think, this is a great opportunity not just for Micromax but the entire country. While earlier, key players used to prop up from Europe or the US, emergence of the next smartphone big brand is going to be from India.

What led to Micromax’s exit?
 

We failed to match the pricing that Chinese players offered. Competition from foreign origin companies was always there in the Indian handsets market. Be it Nokia or Samsung, we not only kept hold our ground but also added market share. Since Chinese firms began entering the market in large numbers, the entire market dynamics changed. Not only Micromax but all Indian brands were pushed out of the market.
 

Where was Micromax’s management for the past few years? What was the thinking?
 

For the past few years, we have been taking blows, one after another. So, we decided to wait and watch for the right opportunity. And that was a wise decision that instead of spending big money in an uneven race, we held on to our nerves. Meanwhile, we have been manufacturing for other brands or government bodies. We shipped out 500,000-700,000 feature phones a month. Our entire service and distribution network is intact. It’s just smartphones manufacturing that was put in a slow lane.
 

A lot has changed since your heydays. What is your assessment of the market now?
 

Unlike earlier, a mobile handset is no more just a tool for communication. It has taken a much larger role in everybody’s daily lives by becoming a crucial productivity device. The importance of broadband data connectivity and personal data is now at the forefront of any battle. Unfortunately, we have given access to all our personal data to Chinese players. If the situation deteriorates with our neighbour, we don’t know how they will use the data.
 

So, how will the new ‘In’ smartphones be more secure?
 

All Chinese brands use their own operating system software. But we have not adopted any strategy to monetise through value-added services. We are not going to use consumer data. We are using stock Android that will offer completely secured ad-free experience.
 

But how will you compete with Chinese giants now?
 

‘In’ will only focus on performance-oriented products because whether you are a gamer or content enthusiast, performance is the key factor for any type of consumers. Our first two phones are better than handsets offered by Chinese brands — both in terms of pricing and quality. The production-linked incentive (PLI) scheme that the government has recently introduced helps mitigate the advantage that Chinese players had in terms of aggressive pricing. The six per cent benefit on cost is a huge breather. It will now put us on a par in terms of pricing and quality and help us in taking them head-on.
 

How do you match the 60 per cent exports target?
 

While our domestic market is very big, we are already getting queries from abroad. So, I don’t think achieving the 60 per cent export target will not be an issue.