Gionee plans Rs 300 cr manufacturing unit in India

Betting big on the booming smartphone demand in India, Chinese handset maker Gionee plans to set up a manufacturing facility in India with an investment of Rs 300 crore (Rs 3 billion) in the next three years.

The company has roped in consultancy firm Ernst & Young to advise on partners and potential locations across the country.

"We have already seen two locations. Our head of manufacturing, who takes the final call, is visiting in three weeks. Post that, we will be in a better position to talk about the location," Gionee India Chief Executive Officer and Managing Director Arvind Vohra told PTI.

The company will invest Rs 300 crore in the next three years for setting up manufacturing base in the country, which will cater to the domestic market as well as to markets in SAARC and Nigeria, he added.

Gionee has also earmarked a budget of Rs 225 crore (Rs 2.25 billion) for marketing and advertising, up from Rs 132 crore (Rs 1.32 billion) last year.

The company will begin with manufacturing entry-level devices, Vohra said. Gionee, which claims to have sold 4 million devices in India last year, is confident of sales doubling this year.

India is already the second biggest market for the Chinese firm. "Last year, we sold 4 million devices in India and 28 million globally. That is one-seventh of the total sales. This year, we expect the sales to touch 8 million," he said.

Gionee on Saturday launched its 'ELife S7' in the Indian market, priced at Rs 24,999.

The phone supports dual SIM, multi-band and multi-mode 4G systems, features 5.2" Super AMOLED screen, 1.7GHz octacore processor, 2GB RAM, 13 MP rear and 8MP front camera, 16GB built-in memory and 2,700mAh battery.

Other handset makers like Karbonn and Xiaomi are also looking at setting up manufcaturing unit in India as the government tries to woo these firms with sops for local manufacturing.