Inventec Corp (TPE: 2356), a mobile device maker and the major supplier for China’s Xiaomi, said that it will begin mass production at a new factory in India during the second half of 2015 as part of its overseas expansion.

Huang Kuo-chun (黃國鈞), Inventec’s general manager, said that the company’s new plant is located in Chennai, a southern city of India. The plan has been approved by the company’s board of directors on Jan. 26. Initial production is expected to start in the late second quarter or early third quarter before entering mass production in the second half of the year, Huang said.

Huang said that the new plant in India, where is the world’s third-biggest smartphone market, will be used to assemble smartphones as well as other electronic devices, while components will be purchased from local Indian suppliers.

“In addition to China, India will mark our first step toward expanding capacity,” Huang said.

In the meantime, Huang also said that it remains unclear how much the Indian factory will account for Inventec’s total capacity in the next two years.

“Inventec’s major customers are ‘optimistic’ about its investment in the Indian plant but noted that there are still some challenges for the company to enter the Indian market, including the diverse Indian languages and cultural differences,” Huang said.

For now, he said, Inventec has a smartphone assembly factory in Nanjing, China, where monthly production capacity has increased from six million units last year to eight million units currently and is estimated to reach 10 million by the end of this year.

During a press conference last month, Inventec Chairman Richard Lee (李詩欽) said that the company’s shipments of mobile devices were estimated to increase from 30 million units in 2014 to 50 million in 2015, helped largely by the increasing orders from major customers like Xiaomi and growth in tablet computers.

Xiaomi, the leading Chinese smartphone maker, sold a total of 61.1 million smartphones in 2014, tripled from 18.7 million units in 2013. The “Chinese Apple” aimed to ship 100 million smartphones this year, of which Inventec is expected to receive 50% of the orders.

The post Inventec Ready for Mass Production in India appeared first on VR World.

Xiaomi’s newly launched 5.7-inch flagship smartphone – Mi Note – seemed to help boost several Taiwanese contractors’ business.

On Jan. 15, Xiaomi unveiled the Mi Note flagship smartphone that features ultra-slim design, a more powerful processor, improved cameras and better display resolution.

Priced at US$412 for the Mi Note Pro and US$372 for the Mi Note in China, the former sports Qualcomm’s Snapdragon 810 chipset, 4GB of RAM, and a quad HD display, while the latter is equipped with the Qualcomm Snapdragon 801, 3GB of RAM, and a full HD display. The Chinese smartphone maker also touted the fact that unlike the iPhone 6 variants, the rear camera sits flush with the phone’s body, and does not protrude like the American flagship.

“The newly debuted flagship model is evidence of Xiaomi’s strategy to expand its product portfolio in 2015,” said Jasmine Lu (呂智穎), a Taipei-based analyst with Morgan Stanley. “Competition is intensifying in China and overseas expansion will take time to bear fruit, but we believe Xiaomi can still outgrow peers via a broader mix.”

Lu, meanwhile, estimated that Xiaomi will begin its mass production of the Mi Note sometime in February or March, with shipments forecast to total eight million to 10 million units during the whole product cycle.

Xiaomi sold a total of 61.12 million units of smartphones in 2014.

The analyst said that FIH Mobile (HKG: 2038), a unit for Taiwanese contract electronics maker Foxconn Technology Group (TPE: 2354) and one of Xiaomi’s suppliers, will benefit from a higher average selling price for casings and will gain about 50% of the assembly orders.

“This means that Xiaomi is expected to contribute around 13% of FIH’s total revenue in 2015 and more than 45% of its gross profits this year,” she said.

Lu also named FIH and Hong Kong-listed AAC Technologies Holdings Inc (HKG: 2018), the main sources of Xiaomi’s acoustic and RF solutions, as the top two picks in Xiaomi’s supply chain and maintained an “overweight” rating on both stocks.

One of the Mi Note’s highlights is its 13-megapixel rear camera equipped with Sony’s IMX214 sensor. The Note’s camera selection represents a potential boon to a lot of Taiwanese suppliers, including Sunnic Technology and Merchandise, a partnering distributor of Sony (TYO: 6758) parts and modules, camera lens maker Largan Precision (TPE: 3008), camera module makers Primax Electronics (TPE: 4915) and Lite-On Technology (TPE: 2301), and electronic manufacturing service provider Inventec (TPE: 2356).

Display panel suppliers Wintek (TPE: 2384) and TPK (TPE: 3673), however, will not be included in the list of Taiwanese companies set to benefit from Xiaomi’s phablet sales although these two screen and touch panel manufacturers have been Xiaomi’s partners since 2013, now that Xiaomi decided to commission Japanese competitors Japan Display (TYO: 6740) and Sharp (TYO: 6753) for the job.

In order to achieve the Mi Note’s 7-mm thickness, which is 0.1-mm thinner than the iPhone 6 Plus, Xiaomi had adopted the in-cell touch display technology made by the Japan Display and Sharp, over TPK’s touch-on-lens and Wintek’s on-glass-solution.

Xiaomi observed a sales drop during the fourth quarter last year. The sales drop was related to its then-supplier Wintek’s being beleaguered by ailing financial condition and is in the midst of a restructuring process. The Taiwan-based touch panel maker supplied touch panels for both Apple and Xiaomi. In an attempt to vie more orders, Wintek invested large sums of funds to increase its production yield. Much of the funds were used to build new facilities in Dongguan, China, and Vietnam. The much lower-than-expected demand for touch panels, combines with competition from Chinese rivals, however, caused Wintek great losses on assets. Wintek filed a petition to the court last October for seeking business restructuring.

The announcement surprised many of its clients, including Xiaomi, which was also forced to find a new touch panel supplier. With a new supplier, it also took more time for quality control and to increase capacity, which also affected Xiaomi’s smartphone shipments for the fourth quarter last year.

Xiaomi’s smartphone sales took a plunge by four million units during the fourth quarter last year following Wintek’s restructuring announcement in October.

The post Xiaomi’s Mi Note Helps Boost Taiwanese Suppliers’ Business appeared first on VR World.