Lava, once a popular phone brand in India, has now begun making phones for Nokia. According to a report, Lava International is also in talks with Motorola to build phones for the Lenovo-owned smartphone maker. It is also said to be in advanced talks with one of the top Indian telecom operators to build co-branded smartphones.
For Lava, the move will be a big turnaround in its operations in the country. The company lost ground when Chinese smartphone makers entered the market with devices offering better value than their Indian counterparts. Now, Lava is resorting to making phones for other brands.
Lava plans co-branded smartphones with Indian telco
In a report, the Economic Times reported that Lava is in advanced talks with a leading telecom operator to make co-branded smartphones. The co-branded smartphone will reportedly be subsidized by the operator and could be an affordable 4G smartphone. It is also believed to be in talks with all three telecom operators for design and manufacturing of smartphones.
“Lava has reached an advanced level of talks with one of the telcos. Phones will be co-branded but will be subsidised by the telco,” a person familiar with the plan told ET.
Bharti Airtel is believed to be working on a low cost 4G smartphone under the carrier subsidy model as well. ET had previously reported that the telecom operator is talking to handset vendors to develop the device. Airtel’s move could mimic Reliance Jio’s JioPhone series made by Flex and subsidised by the operator.
Lava is one of the beneficiaries of the Production Linked scheme (PLI) from the Indian government. Along with Bhagwati (Micromax), Padget Electronics, UTL Neolyncs and Optiemus Electronics, the local players have proposed production output of Rs 1.25 lakh crore over the next five years.
The report highlights how Lava is transforming itself into a contract manufacturer taking advantage of the PLI scheme. Apart from Nokia and Motorola, Lava is also working with US companies like AT&T and General Electric (GE) to provide affordable smartphones to them.
Along with contract manufacturing, Lava is also looking to partner with companies that can share supply chains. “Lava wants to work with important companies that are from outside of the ecosystem in India so that their supply chain can be combined,” the person told.
ET had previously reported that Motorola is in talks with Dixon Technologies and Lava for a contract manufacturing of $1 billion worth of smartphones in India. The company has increased its production capacity to 30 million smartphones and 45 million feature phones. “Lava will be able to meet the PLI target for this year,” the person added.
For Lava, this could be an opportune moment to turn its business into building its own feature phones and smartphones for others. It is also said to be making renewed plans for presence in the Rs 6,000 to Rs 10,000 price segment. With the PLI scheme approved, Lava is looking to revamp its brand identity in the country.