In Short:
Xiaomi India aims to be the largest connected ecosystem player in the world by shipping 700 million devices in the next 10 years. The company has sold 350 million devices in the last decade, with a focus on component localization in the country. Xiaomi will continue to invest in R&D and aims to be the preferred brand for Indian consumers. The company’s smartphone shipments grew by 28% year-over-year in Q1 2024.
Xiaomi India Aims to Ship 700 Million Devices in Next 10 Years
Xiaomi India is on a mission to become the largest connected ecosystem player in the world by targeting to ship 700 million devices including smartphones, IoT devices, and wearables in the next decade. The company has already sold around 350 million devices across various product categories, including 250 million smartphones, over the past ten years.
Focus on Component Localization
Muralikrishnan B, President of Xiaomi India, has stated that the company plans to deepen its component localization in the country. Currently, local non-semiconductor components account for 35% of the total bill of material (BOM), which is sourced locally. The aim is to increase this localization to 55% within the next two years. Furthermore, Xiaomi will continue to invest significantly in research and development, with approximately 5% of revenues being allocated to R&D globally.
Customer Preference Over Market Position
Xiaomi India’s goal is to be the preferred brand for Indian consumers, rather than focusing solely on achieving the top market position. Muralikrishnan emphasized that becoming number one should be a byproduct of delivering the best experience to customers. The company’s approach has evolved to prioritize customer preferences, ensuring a sustainable growth strategy.
Challenges and Growth in the Indian Market
One of the major challenges in India’s electronic product manufacturing sector is the lack of high local value addition due to the absence of electronic components. Xiaomi India aims to address this issue by increasing domestic value addition from 18% in the financial year 2023 to 22% by FY2025 through a focus on expanding the component ecosystem.
Market Performance and Strategies
According to Counterpoint, Xiaomi’s smartphone shipments grew by 28% year-over-year in Q1 2024, with a volume share increase from 15.8% in Q1 2023 to 18.8% in Q1 2024. This growth was attributed to a streamlined product portfolio and a proactive offline channel strategy. The announcement was made by a top Xiaomi India executive during the company’s 10-year anniversary celebration in Bengaluru.
