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March 09, 2010

Micromax who?

Did you know that Micromax is the third-largest GSM mobile phone vendor in India with a 6% market share (after Nokia (62%) and Samsung (8%))? Neither did I. In fact, I had not heard of the company until it became the sponsor of the recent cricket series between India and South Africa. Forbes India has a interesting profile of Micromax, which recently raised a $45 million round of Private Equity funding.
This “dual-SIM” feature is today present in 20 to 30 percent of all mobile handsets sold in India, estimate experts. Yet market leader Nokia does not have a single dual-SIM handset in its vast repertoire of phone models for India. And the company that made Raina’s Q3 — Micromax Mobiles — offers this feature on 22 out of the 26 phone models it sells in India. The Q3 itself, though fancy looking, costs only Rs. 3,700.

Micromax is now India’s third-largest GSM mobile phone vendor with a market share of 6 percent after Nokia (62 percent) and Samsung (8 percent), according to research firm IDC. It sells anywhere from 700,000 to one million mobile phones every month. And by its own estimates it is now selling nearly Rs.1,500 crore worth of phones annually.

...So Micromax decided to give a 5 percent commission to each of its distribution chain partners — the 34 “super-distributors”, the 450 distributors and the 55,000 retailers. But there was a catch — it would not offer any credit. Instead distributors are expected to complete an online bank transfer to Micromax before getting any of its phones to sell further on.

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of data and analysis on private equity, venture capital and M&A deals in India. View free samples of Venture Intelligence newsletters and reports. Email the author at