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    India has the potential to become our top revenue generator by next year: Florian Seiche, CEO, HMD Global

    Synopsis

    "India is today one of the top three markets by revenue for us, due to the combination of feature phones and smartphones."

    ET Bureau
    HMD Global, the Finnish maker of Nokia-branded phones, will redouble its focus on India, the company’s newly named CEO Florian Seiche told ET. In his first interview after taking charge a day earlier, he said that India has the potential to become the leading contributor to the company’s revenue by next year, from being among the top three. The Nokia brand is already within touching distance of being No. 1 in feature phones in India, and it is aiming for an overall top three rank within three years, he said. Edited excerpts:

    As new CEO of HMD Global, how do you see opportunities and challenges?
    It feels like a continuation to me since I have been co-leading this from the beginning. The part that we are most excited about the journey so far is the consumer feedback on the phones because it’s been phenomenal. Two key initiatives going forward are – making a very strong impact through portfolio expansion in smartphones and geographical expansion. We need to be agile and to leverage strategic partnerships with our partner ecosystem, including Foxconn and Google.

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    How important is it to differentiate in a hyper-competitive market such as India?
    We see the brand as a unique advantage we can build on and leverage, and India for us is clearly at the heart of or a very strong pillar of our strategy. We know the market is super competitive here, but to be honest it is very competitive in other parts of the world also.

    Pekka Rentala, chief marketing officer: India is an anchor market for us because it also resonates in global market; people watch how India is reacting to Nokia phones.

    Was it difficult handling a management change within 11 months?
    No, absolutely not. We are very happy with the support that we are getting from partners. Arto (Numella, CEO) left, which was a personal choice, but we have been here from the beginning and the top leadership is here.

    Ajey Mehta, India head: Within six months we have done great business, it's grown five to six times. In feature phones, we are No 3.

    How do you plan to leverage the factors working for you to increase market share?
    From a global perspective, in feature phones, we will probably be No. 1 in the world in terms of value by the year-end. We are either No. 1 or No. 2 by value in most of the markets globally. Even in the feature phone market, because of the Nokia brand, we are in the mid-low to upper segment, which gives us a value advantage. This gives us a strong platform in India… to upgrade this large base of feature phone users to either within feature phones or to smartphones. We have 85,000-90,000 stores through 450 exclusive distributors, which will grow to 100,000 by the year-end.

    What are your targets in India?
    Mehta: We are looking to be among the top three smartphone players within the next three years.

    Seiche: We are in it for the long term. In feature phones, we are within reach of becoming the leader, hopefully, sooner than three years.

    What is the roadmap for the 4G feature phone?
    It’s an interesting opportunity for us, but we have no product announcements to make as of now. The architecture in 4G feature phones is much like smartphones, so things like battery life, the usability of the phone become important. Therefore, when we make product decisions or choices, we are thinking how to make this the best possible quality offering within a certain price range.

    Are partnerships with telecom operators becoming the norm for handset makers?
    We are definitely looking for partnerships with telcos. We have partnership with Airtel, Jio and we are looking for partnerships for Nokia 2.

    Have you reached a stage where you can export from India? Are you planning any capacity expansion here?

    Mehta: All phones made here are for the India market. The way the business has grown over the last few months, for sure, the capacity has to grow. But whether it expands geographically or in the same place, it’s for Foxconn to decide.

    Seiche: I have taken the initiative to have our next global leadership meeting in Chennai, next to our facility, and we will have next board meeting at the same time there, to high light the importance of India and to have a first-hand look at the factory.

    What impact has the implementation of GST regime had on your cost and operations?
    Mehta:
    We have re-looked at our network and we are exploring how to optimise costs. The transit times have come down. We haven’t brought down the number of warehouses, but ease of doing business, supplies and logistics have improved.

    What is India’s contribution to your global revenue?
    India is today one of the top three markets by revenue for us, due to the combination of feature phones and smartphones.

    Can India be your largest market by next year given the pace of growth?
    It has the potential for sure. HMD Global will complete one full year of operations next month.

    What is your revenue expectation?
    We are pushing as hard as we can. We are confident we will end the year in good shape. We want it to be a solid and profitable growth path for us. You have seen too many players come and go very quickly because of an overambitious growth plan that is not matched by profitability and leads to a sharp retraction.
    The Economic Times

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