After its sales reportedly grew seven folds, India unit of Xiaomi has turned profitable in just three years of its arrival in the country. Xiaomi has been reported to have made a profit of Rs 164 crore during the FY 2017, up from a loss of Rs 47 crore in 2016. The company’s revenues surged this year as well, wherein Xiaomi had sales of Rs 8,380 crore, up from just Rs 1,046 crore last year. That’s a surge of 696 percent in sale.
“The entire revenue is generated through sale of cellular phones, accessories, spares and services. Directors expect the performance of the company during the current financial year to improve as estimated,” ET reported Xiaomi saying in its regulatory filings.
The home-market being the biggest, India is the second most important market for Xiaomi. During the July-September quarter, IDC reported how Xiaomi caught up with Samsung in volume shipments in India. For that matter, Xiaomi even outstriped the revenues of Indian smartphone manufacturers like Micromax, and Intex.
As reported by OfficeChai, Xiaomi’s revenues of Rs 8,380 crore far outstrip the revenues of homegrown brands like Micromax, which made 5,614 crore, and Intex that made Rs 4,364 crore. While Xiaomi’s revenues surged this year, Micromax and Intex saw a downward graph. Micromax’s revenues fell 42 percent this year, while Intex’s fell 30 percent.
In fact, Xiaomi together with Oppo Mobile India (another Chinese smartphone manufacturer), added over $2 billion of sales in India, considering the latter too grew by 754 percent last year to Rs 7,974.3 crore.
The increasing revenue of Chinese smartphone manufacturers in the country is indicative of increasing trust of Indians on products that were widely considered as “rip-offs” till some years ago. However, Xiaomi especially has managed to make its way to the heart of the Indian consumers via its unusually low pricing. The company is actively aware of the demands and the spending habit of the consumers in the country, and strategizes its sale accordingly. For instance, Xiaomi did not release its flagship Mi 6 in India, saying that it was too expensive for the market, instead launched the Redmi 5A in the country, which it calls the ‘Desh ka smartphone’.