LG aims to get Rs 600 crore from youth-centric phones

LG Electronics India Private Limited (LGEIL) is expecting youth-centric phones to contribute 20 per cent to its value turnover this year – which translates to about Rs 600 crore, according to Sudhin Mathur, business head (mobile communication), LGEIL.

The company today launched two new handsets – LG Cookie Fresh and LG Cookie Plus – bundled with one-touch social networking powered by an SNS widget on home screen and 3G technologies, priced at Rs 6,199 and Rs 7,990 respectively.

“We are targetting youth between the age group of 18 and 25 years for this new range, which is expected to contribute 20 per cent from this category of phones,” Mathur told mediapersons here on Tuesday. Currently, the estimated GSM market size is 100 million units. LG enjoys around 9 per cent market share and is expecting to have a 15 per cent share this year, he said.

“With 22 launches in the year till date, we will be unveiling an equal number of models this year – from entry-level to 3G touch phones – of which 14 models will be youth-centric,” Mathur said.

Stating that the company had revamped its distribution structure this year and would now follow a clear vertical format, wherein regions have been created across India which are managed by regional distributor, who in turn will supply to city-level distributors, who eventually distribute it to the retailer. LGEIL currently has 400 city-distributors and 20,000 retailers for its mobile sales, which will be scaled up to 30,000 by the end of this year.

“We will be spending around Rs 290 crore this year, as against Rs 100 crore last year, on marketing activities including advertising, communications, retail and visibility investments,” Mathur said, adding the company was looking at a three-fold increase in revenues from its mobile business to Rs 3,000 crore this year, as against Rs 1,000 last year.

“Our growth focus would be on the Rs 4,000-Rs,8000 category, which is expected to account for 20 per cent of our mobile business revenues,” Mathur said.