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boAt forms jt venture with Dixon Tech to manufacture wireless audio products in India
Consumer electronics brand boAt’s parent company, Imagine Marketing Pvt Ltd, has entered into a 50:50 joint venture with Dixon Technologies Ltd to manufacture wireless audio products in India. The two players expect the JV entity to achieve revenues of ₹1,000 crore by the end of four years.
Vivek Gambhir, CEO, boAt told BusinessLine, “In a short span of time, we have established a clear leadership in the personal audio segment. We continue to strengthen our presence by focusing on launching competitive and more innovative products, diversifying our supply chain and by making significant investments in design, R&D and technology partnership. This joint venture with Dixon is an important milestone for us to establish a strong manufacturing ecosystem in India. It will help us to become more agile, launch more innovative products and also bring down the cost of products for consumers.”
Supply chain leveraging
The joint venture will help boAt to establish a manufacturing base in India and de-risk its supply chain by leveraging on the high quality and low-cost structure of Dixon Technologies.
Saurabh Gupta, CFO, Dixon Technologies added, “We feel confident that by the end of the fourth year, the JV will achieve revenues of about ₹1,000 crore. The total capex over the period of four years will be to the tune of ₹40 crore. Out of this about ₹15 crore will be the investment made by both the partners as equity contribution and the balance ₹25 crore will be funded through strong cashflow generation by the JV entity.”
IP development expertise
The joint venture will initially focus on manufacturing Bluetooth-enabled wireless audio devices and at a later stage will also explore opportunities to make other lifestyle-oriented products. Gambhir added that it will go beyond manufacturing and also focus on building expertise in IP development and strengthen in-house design capabilities.
“The headroom for growth, in the categories that we are present in, is tremendous. We will strive to develop innovative products through this JV not only for the Indian consumers but also for international markets,” he added.
Established in 2013, Imagine Marketing Pvt Ltd. offers a range of products that include audio gear, smart wearables, personal grooming products and mobile accessories, among others. The Hindu BusinessLine
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