Karbonn to raise Rs 554 cr via private equity

Homegrown mobile handset company Karbonn plans to raise about $125 million ( Rs 553.62 crore) in the next few months through private equity (PE) players to fund expansion plans.

"We are looking at raising $125 million to fund our expansion plans. This will be done through PE investors and we will finalise plans in the next quarter. By the end of this quarter, there should be clarity on how we are going about it," Karbonn Mobiles Executive Director Shashin Devsare told PTI.

The company is looking at the dilution of up to a 15% stake during the process, he added.

Karbonn Mobiles is a joint venture between Delhi-based Jaina Group and Bangalore-based UTL Group.

"The funds would be used for expansion of its research and development units in Delhi and Bangalore and marketing activities," Devsare said.

Karbonn have a share of about 5% of the over Rs 30,000 crore Indian mobile handset market.

"Currently, we are selling about 700,000 to 800,000 units a month. By the end of this fiscal, we are looking at 10 million handset sales," he said.

Karbonn is also foraying into segments like smartphones. It has launched a new smartphone -- A1 -- based on Google's Android 2.2 operating system for Rs 6,999.

"We want to revolutionise the highly popular Android market in India. With a price point of sub-Rs 10,000, the handset is set to take smartphones to new segments of the population," Devsare said.

The handset will be pre-loaded with popular Google applications like Google Map, Gmail and GTalk and will support the Android Market (app store).

"We are looking at introducing three more smartphones by Diwali in the Rs 6,000-10,000 price bracket," Devsare said.

"We are focusing on strategies like interacting with consumers at the ground level, developing products according to their needs and strategic tie-ups, with high visibility events," he said.

The company is associated with the IPL cricket tournament and also sponsored the one-day series between India and Sri Lanka in 2009.