Dixon Invests Rs 300 Crore In Noida Plant To Make Xiaomi Smartphones
The production will take place at its wholly-owned subsidiary, Padget Electronics Pvt., Dixon said.
Dixon Technologies (India) Ltd. is set to kick off smartphone manufacturing for Xiaomi Corp.'s Indian arm, with the aim of exporting 30% of the total capacity being produced over the next two to three years.
The production will take place at a new plant set up by Dixon's wholly-owned subsidiary—Padget Electronics Pvt.—in Noida, Uttar Pradesh, entailing an investment of around Rs 300 crore.
The factory was inaugurated by Union IT Minister Ashwini Vaishnaw on Thursday. Addressing the media, he acknowledged India's emergence as an export hub, with the country already witnessing $12 billion in exports.
Padget is among several mobile phone manufacturers that have got benefits under the government's production-linked incentive scheme, having met the incremental production target in 2022.
“Due to PLI, the incremental job creation in the mobile industry is 5 lakh and the number will increase in the next five years," the minister said.
Dixon's new manufacturing facility, he said, will add 5,000 jobs.
The minister also said that domestic value addition was rising steadily due to the PLI scheme and is as high as 60% in certain product categories.
"It is a momentous step towards our commitment to boosting local smartphone manufacturing," said Sunil Vachani, founder and chairman of Dixon Technologies.
Spanning 3 lakh sq ft., the Noida factory is the largest mobile phone manufacturing plant for Dixon with a capacity to make 25 million phones a year.
In total, Dixon now has four mobile manufacturing plants with an annual smartphone production capacity of 70 million.
The company is also in the process of setting up the next mobile manufacturing unit, which will be spread over 10 lakh square feet, said Vachani.
Dixon is also looking to expand its exports basket. "Last year, we exported mobile phones worth Rs 1,200 crore, and this year, we would be doubling it to Rs 2,000 crore," Vachani told BQ Prime on the sidelines of the event.
Earlier in September, the contract manufacturer entered into an agreement with Xiaomi to manufacture the brand's smartphones.
The move came after Chinese brands had been nudged by the Indian government to produce locally and serve overseas markets.
This shift means that Xiaomi’s previous suppliers in the country, such as Foxconn Technology Group’s Bharat FIH Ltd. and DBG Technology Co., may see a decline in business opportunities. Other players such as Vivo, Oppo and OnePlus, however, continue to manufacture themselves.
Xiaomi’s collaboration with Dixon follows a similar pattern from earlier this year, when it decided to outsource its audio business to another Noida-based company, Optiemus Electronics Ltd. That time, too, the move was part of the government's efforts to curb imports and to involve more local companies in the supply chain, distribution and manufacturing.
Dixon has signed a five-year contract with Xiaomi.
The company also manufactures smartphones for brands such as Motorola, Samsung, Nokia, and Jio Bharat. "Other than Xiaomi, the Noida facility will also make Jio phones," Vachani said.
