China's Holitech Group today said it will set up a production facility in Tirupati, Andhra Pradesh, with an investment of Rs 1,400 crore (USD 200 million) to supply mobile phone components like camera modules and touch panels to smartphone major Xiaomi.
Spread over 75 acre, the facility is expected to be operational in the first quarter of 2019, providing employment to about 6,000 people at full-scale in the next three years.
"We will set up the plant in two phases with phase I starting in January where we will invest USD 100 million and phase II, an additional USD 100 million. The facility will cater exclusively to Xiaomi," Holitech Technology CEO Guisheng Chen told reporters here.
He added that the facility will have an annual capacity of 50 million component sets at the end of phase I and ramp it up to 100 million within three years' time.
The components that will be made at the Tirupati facility include camera modules, TFT (thin film transistor), flexible printed circuit, touch panels and fingerprint modules.
In April, Xiaomi had hosted a global meet in Delhi that saw participation from 50 of its global suppliers. The company, at that time, had said these suppliers setting up manufacturing base in India would bring in Rs 15,000 crore in investment and create 50,000 jobs.
"We are committed to Make in India and our intent is to get our partners to also manufacture locally here. Holitech's plant will cater to significant part of our requirement. We will continue to work on getting more partners to set up base in India," Xiaomi Vice President and India Managing Director Manu Jain said.
He added that local manufacturing of components could bring down prices of mobile phones.
Holitech, which supplies to other global handset makers also, has 16 factories in China and Taiwan and employs about 30,000 people. The company expects to clock USD 4 billion in revenue this year.
"The facility in India is our first international foray. We expect to see revenue of USD 2 billion from here after phase II," Chen said.
Andhra Pradesh IT Minister Nara Lokesh said the state presents an attractive opportunity for companies looking at setting up manufacturing base.
"Our state of the art infrastructural offerings make Andhra Pradesh an exciting investment opportunity and it is heartening to see Holitech Technology come to the state and initiate a big revolution in the market for local manufacturing," he added.
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