 "Tata planning to buy Vivo India’s Greater Noida factory, discussions ongoing, claims report")
Chinese smartphone maker Vivo is reportedly in talks to sell its stake in an Indian factory to the Tata Group. This move comes as India intensifies its scrutiny of foreign businesses operating within the country.
The discussions between Tata and Vivo are said to be in advanced stages, with Tata looking to acquire a majority stake in Vivo’s Indian operations. An anonymous source mentioned that Vivo is seeking a high valuation for its asset, as reported by Moneycontrol.
Additionally, sources mentioned that Vivo’s factory in Greater Noida, Uttar Pradesh, has already been sold to Bhagwati Products, an Indian company. The factory is expected to continue production for Vivo under a joint venture with Chinese electronics manufacturer Huaqin Technology, although this arrangement is pending government approval.
This potential deal with Tata underscores the growing ambitions of the Mumbai-based conglomerate. Last year, Tata took over an iPhone manufacturing facility from Taiwanese company Wistron in Karnataka. Following this acquisition, Tata received orders to produce Apple’s iPhone 15 and iPhone 15 Plus models in India, as noted by research firm TrendForce. Tata is also expanding its iPhone manufacturing operations in Hosur, Tamil Nadu, planning to set up about 20 assembly lines, according to a report by India Briefing in April.
For Vivo, selling its stake to Tata comes at a time when India is increasing its scrutiny of Chinese businesses. The Indian government has been pushing for local manufacturers to play a larger role in the operations of foreign smartphone brands. In June of last year, The Economic Times reported that the government asked Chinese smartphone makers to appoint Indian executives to key roles in their local operations.
Impact Shorts
More ShortsIndia is the second-largest smartphone market globally, dominated by foreign brands, including several Chinese companies. In the first quarter of the year, the top five smartphone vendors by value were Samsung, Apple, Vivo, Xiaomi, and Oppo, according to data from Counterpoint Research.
Vivo, headquartered in Dongguan, China, has faced significant challenges in India. Last October, India’s Enforcement Directorate, which handles financial crimes, arrested four Vivo executives. This followed raids on multiple Vivo offices in July on suspicion of money laundering, similar to actions taken against Xiaomi and Huawei Technologies.
Additionally, India’s revenue intelligence unit detained around 27,000 Vivo smartphones worth nearly $15 million at New Delhi airport in December 2022, preventing the company from exporting them to neighboring markets, as reported by Bloomberg.
The increased scrutiny of Chinese businesses is part of India’s broader strategy to reduce reliance on Chinese technology and boost local manufacturing. The potential sale of Vivo’s stake to Tata aligns with this strategy, indicating a significant shift in India’s smartphone manufacturing industry.
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