Could Maxx be India's smartphone underdog?

The Indian mobile phone market is a curious thing in that dozens of small brands battle for a percentage or two of market share. Maxx Mobile is just one of these contenders, but it’s about to make some big noise. Over the past couple of years, Maxx has faded away from the limelight after some mainstream spotlight thanks to cricket sponsorships.

The company recently launched two new Android smartphones and both hit the right spot when it comes to specs vs price. Now Maxx is looking at gaining three percent market share of the smartphone market in this fiscal year. Three percent might seem like a small number, but considering the current and potential size of the Indian market, it’s a healthy percentage. To do this, the company is about to launch a bunch of devices across price bands and could have a couple of tricks up its sleeve.

Maxx Mobiles has big plans for 2013

“Besides focussing on the top end of smartphone market, we will have Android smartphones in the Rs 3,000 to Rs 5,000 price range targeted at the price sensitive Indian consumers. We will also have a range of high quality accessories for these smartphones,” Ajjay Agarwal, Chairman and Managing Director, Maxx, told PTI.

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While its current market share is negligible, the Mumbai-based company is aiming to grow its revenues to up to Rs 650 crore this year, which would represent a more than 25 percent increase over last year. It also plans to launch about 500 new devices this year, including feature phones and tablets. “These will include 250 models of feature phones, 200 of Android operating system-powered smartphones and 50 variants of tablet PCs. Our smartphones are priced between Rs 3,000 and Rs 16,000. The focus is on offering the best features at the most affordable price points," Agarwal said.

All this is great if Maxx wants to be noticed, but the company may also have a trump card in its hand. ZDNet reports that Maxx will start production in a new Uttaranchal facility soon, moving away from China as its manufacturing base due to the falling rupee, the increase in costs there and the rise in excise duties on imported handsets.

Manufacturing costs in China have reportedly gone up by 20 percent, which will undoubtedly affect the prices of devices made there, even when sold by Indian brands. In comparison to the phones imported in India, which are levied with 7 percent duty (for phones priced over Rs 2,000), India-manufactured phones are taxed only one percent. This will be a significant advantage for Maxx and other manufacturers who are looking to set up production facilities in India. In addition, the potential marketing win of a phone manufactured in India cannot be underestimated.

The company’s Race series of phones comprise the higher-end models in its portfolio, going directly against the Micromax Canvas series and the Karbonn Titanium range; however, they fall short in terms of specs, especially considering the hype surrounding the recently-launched Canvas 4 and the forthcoming Karbonn Titanium S6. Will Maxx Mobiles be able to get its coveted three percent? Of course, it will take a lot more than showing intention with products and having cost advantage. As we have already pointed out, Indian brands need to sort out a lot of the current problems if they hope to make it big. Here’s hoping that Maxx has read our memo.