Xiaomi has created headlines again. Chinese smartphone maker and appliances Xiaomi Corp. have planned to launch at least six smartphone models in India this year, open 100 exclusive stores, release more new product categories in the near term and also build out a big, non-smartphone business from its new range of televisions.
Also, in a recent interview, Xiaomi global vice-president and India head Manu Kumar Jain added that the Chinese firm, which has been a prolific investor in India’s rapidly-growing start-up ecosystem in recent times, would be also acquiring stakes in software and internet start-ups over the next 12 months. Of course, this would be in the pace of its investments over the next few years, as part of its broader strategy to invest $1 billion in Indian ventures.
However, Jain did not specify how many start-up investments the company would make in the next 12 months, but the company’s five-year target suggests that the Chinese firm would look to back an average of nearly two dozen start-ups annually over the next 4-5 years.
To this Jain added that “I really hope we can increase the pace (of investments) and invest in a lot more companies. India is changing drastically. We really believe that India will become hugely digital in the next five years and we want to help promote that. We would want to increase the pace of investments to support these Indian companies. In India, we started with smaller investments…but if there’s a need, we can do bigger ticket sizes.”
In a November interview, Xiaomi founder Lei Jun had pledged to invest at least $1 billion in 100 Indian start-ups over the next five years to create an ecosystem of apps around its smartphone brand.
Right now, Xiaomi’s start-up investments in India are part of a broader trend of an influx of massive Chinese investors in the Indian internet economy, with Alibaba Group Holding and Tencent Holdings, paving the way.
Xiaomi, which has already showcased a number of its products at its own stores, is currently testing a number of new products in India but is yet to take a final call on whether to introduce those products in India, given the unique nature of the Indian market.
To this plan, Jain added that “We have smart scooters, we have smart cycles, smart water purifiers, weighing scales, smart cookers, smart shoes, etc.—people keep talking about these products and asking when we will launch them in India. We don’t know at the moment whether those products will do well in India, firstly, and secondly, even if we were to launch them for India, how would we customize them for Indian conditions?”
It is true that India is Xiaomi’s biggest market outside China. In China, it has launched a wide variety of products including televisions, smartphones, and air purifiers, among other things.
Talking of India, Xiaomi has also tripled its headcount from the past year and has also planned to grow at a similar pace in the next 12 months.
Right now, the company currently has 26 exclusive stores in India, with a few hundred more stores through franchise partners.
Jain stated that “Our aim is to launch many more product categories in India—we already have 7-8 categories in India. If you look at our product line-up in India right now, we have phones, smart TVs, fitness bands, power banks, smart routers, smart air purifiers, and few other smaller categories like t-shirts and backpacks, and some smaller products like audio players”.
To look back, Xiaomi, which entered India in 2014 and tripled revenues from India over the past 12 months, accounted for 25% of smartphone shipments in the December quarter, according to research firm IDC, making it the biggest smartphone vendor in India, ahead of Samsung.