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Micromax Informatics Limited: Growing challenges for India’s Largest Smartphone Maker

Micromax Informatics Limited: Growing challenges for India’s Largest Smartphone Maker
Case Code: BSTR516
Case Length: 7 Pages
Period: 2014 - 2016
Pub Date: 2017
Teaching Note: Available
Price: Rs.300
Organization: Micromax
Industry: Smartphone Industry
Countries: India
Themes: Business Strategy, Strategic Management
Micromax Informatics Limited: Growing challenges for India’s Largest Smartphone Maker
Abstract Case Intro 1 Case Intro 2 Excerpts

Excerpts

Tough Time

Micromax experienced a bumpy ride in 2015. The smartphone maker lost nearly 8% in market share between December 2014 and 2015. Intense competition, spurred by an onslaught of new entrants from China, reportedly hit the company’s shipments, which were down 12.1% year on year and 23.5% quarter on quarter in the fourth quarter of 2015 (See Exhibit III). Chinese OEMs, such as OPPO from whom Micromax sourced phones, started flooding the Indian smartphone market, offering high-end smartphones at affordable prices. In addition, home grown rivals such as Intex Technologies (India) Ltd. (Intex) and Lava International Limited (Lava) started giving Micromax a run for its money. According to industry analysts, though Micromax maintained a steady flow of new launches at regular intervals, its products brought nothing new to the table. On the other hand, rivals such as Samsung, Lenovo Group Ltd., Xiaomi Inc., and LeTV launched smartphones with cutting edge technology...

A New Beginning

With the company in dire straits, the co-founders were forced to come back to helm the company. They started managing the day-to-day operations of the company. While Sharma managed the Yu brand, marketing and branding of mobile phones, Jain was in charge of partnership development, services, tablets, computing business, and finance. Agarwal handled sales and sales support, human resources, international and LED businesses, and manufacturing while the legal, R&D, and information technology departments were supervised by Arora...

The Road Ahead

In April 2016, Micromax unveiled a new logo and tagline, launched new handset models, and started its own ecommerce portal, in an aggressive bid to consolidate its position in the growing Indian smartphone market (See Exhibit V). The company expected to sell about 56 million mobile phones in India by March 2017 and figure among the top five brands in the world by 2020. Additionally, Micromax invested in three new manufacturing units in India to ramp up domestic production and reduce dependence on outsourcing...

Exhibits

Exhibit I: Micromax Smartphone Market Share
Exhibit II: Global Smartphone Market Share Q1 2015 (%)
Exhibit III: India Smartphone Shipment Share
Exhibit IV: Market Share of Smartphone Vendors’ in India (Q4 2015)
Exhibit V: Smartphone Users in India

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