New distributor for Apple's enterprise solutions won't impact us: Redington

The comment comes after reports that Apple is in talks with HCL Info to appoint it as a distributor

Redington (India) is confident that even if an additional player were to join the ranks of Apple distributors — a status enjoyed by the Chennai-based IT logistics solutions firm — it would not have a negative impact on the company. The claim of Redington, a major distributor for Apple products in the country, comes at a time there has been reports that Apple is in talks with HCL Info to increase its distribution in India.

The company says that according to information on the public domain it understands there is an ongoing discussion, and that a non-disclosure agreement had been signed and an RFP (request for proposal) floated, but essentially for the enterprise business. HCL participated in this and the commercial terms are under discussion.

“But our own view is that Redington is extremely well-positioned with regard to distribution of iPhone, both in the general trade which is where we participate and also the enterprise space,” said Raj Shankar, managing director, Redington (India) Ltd.

“I must mention here the enterprise piece of the business is about 10-15 per cent, so even if there is an addition of another distributor it is still going to be within this 10-15 per cent pie and therefore to that extent, the 85-90 per cent will continue to be addressed by the existing distributors. So it will not have any negative or detrimental impact on Redington,” he added in a recent interaction with analysts.

Apple is at the top of its largest five vendors. Apple’s contribution to Redington’s business among the top five — which includes HP Inc, HP Enterprises, Lenovo and others — has grown up to 25 per cent during the first quarter ended June 30, 2017, as against 22 per cent during the corresponding quarter of the last year.

It may be noted that Apple, in 2015, added Brightstar as a distributor in India and realigned its distribution network on geographic basis in the country, following which Redington said it did not have a major impact on its business. Apple has four partners in India, including Ingram Micro, Rashi Peripherals and Brightstar, according to reports. Redington has also been entering into tie-ups with various other brands. Recently it said the company has started seeing growth in its non-Apple smartphone business.

The company, in its annual report for the year 2016-17, said that the growth in the non-Apple smartphone segment was 39 per cent, a clear indication that the other brands in its portfolio has begun contributing significantly. In the mobility vertical, it continued to derive value through the Apple business both in India and in overseas markets, said Raj Shankar, while addressing shareholders.

The company, which started to develop a portfolio of non-IT products in 2006, tied up with the market leader BlackBerry as a national distributor for both retail and channel distribution of “unlocked” phones at a time when BlackBerry devices were only sold in locked form through telecom operators.

Later, it tied up with Apple for pan-India distribution of iPhones and according to analyst reports, the iPhone distribution by the company started in 2012. Even though Apple appointed a couple of other distributors in the country, Redington continues to be a major distributor, said company officials earlier. Besides Apple, the company has distribution tie-ups with Google Pixel, Samsung, Xiaomi and Asus. It also has distribution of Apple’s lifestyle products. Redington bagged a distribution agreement for iPhones for Saudi Arabia during FY17, in addition to the UAE and Africa.