Chinese Smartphone Maker Honor Set For India Comeback With Plans For Local Manufacturing By Early Next Year

Chinese smartphone maker Honor is set to make a comeback in India with the help of a licensing deal with a local company.

The Chinese brand's India head has revealed that the company is aiming to begin domestic manufacturing by early next year.

Last year, Honor had stopped selling its smartphones in India due to limited marketing budget and less prudent portfolio management. However, the brand is now ready to reenter the Indian market and make a fresh start.

According to Neil Shah, the vice president at Counterpoint Research, India was not a focus market for Honor until 2020. It was only after being forced to spin-off the brand and reassess their strategy that they started considering India as a potential market.

Honor's comeback in India is made possible through a licencing deal with a newly formed company called Honor Tech, based in Gurugram.

The licencing deal for an "agreed-upon cost" tied to the transfer of technology and hardware has not been disclosed.

Honor plans to introduce three versions of its phones in India, including the mid-range Number series which is expected to be available by September, Reuters reported. The company, which is fully owned by local shareholders, will handle the manufacturing, sales, and service of Honor-branded smartphones in India.

"All the phones will be eventually manufactured in India," CEO Madhav Sheth said, without disclosing further details, Reuters reported.

According to Sheth, a former executive at rival Realme who was credited for its expansion in India, the biggest challenge with the Indian government in the past was how can a Chinese brand be accountable in India.

Chinese businesses in India have faced challenges recently due to the government's ban on several apps and increased scrutiny on investments to prevent takeovers from China.

Honor, a smartphone brand, will be competing with top sellers like Samsung Electronics, which holds nearly 20 per cent of the Indian market share.

Other competitors include Vivo, Xiaomi, Realme, and more, according to Counterpoint Research.

Honor Tech has set a target of capturing 5 per cent of India's smartphone market by sales volumes in 2024, aiming for a revenue of at least 100 billion rupees ($1.20 billion), according to Sheth.