Only lava survived the Chinese attack. Now, it seeks funds to participate in foreign competitors

Sunil Raina, executive director of Lava International, did not disclose the valuation of his current funding efforts, but mentioned early attempts. “During the September 2021 listing attempt, the banker assigned us a ₹valuation of $1.400 billion ($1.7 billion). ”

He also declined to disclose a timeline for possible valuations or republishing his publicly listed paper. “The initial public offering (IPO) will be a strategic move that we will only consider when building a certain scale,” Reiner said. “To do this, we will invest more money into marketing and add our business to more markets for online and offline retailers.”

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Although governments have pushed local manufacturing across departments, lava is seeking to raise funds to expand. Source of data Mint Estimates from Counterpoint and Raina share show that Lava sold about 1.5 million smartphones in 2024. In fiscal till March 2024, Lava International’s consolidated revenue dropped 25% of the year to ₹36.46 billion (US$426 million), net operating profit fell 85% to ₹$1.16 billion ($1.4 million).

The company also faces setbacks. In October 2023, its former managing director Hari Om Rai was arrested by the law enforcement agency during a money laundering investigation into China’s BBK electronics-backed electronic brand Vivo. In September 2021, as the Securities and Exchange Commission of India (SEBI) asked the company to modify and submit documents, the lava disclosure plan was stopped without specifying what information was missing.

Raina says FY25 is better.

Although governments have pushed local manufacturing across departments, lava is seeking to raise funds to expand.

“This year, we expect to report 10% annual growth – about 80% of sales still come from offline channels in terms of equipment transportation and revenue, but we will strengthen marketing and promotion efforts, which is financially to connect with a wider customer base,” Raina said. “In fiscal 26, we will also invest in software research and development (R&D) to create intellectual property (IPS), which is a key part of making greater profits in the long run.”

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“There are some setbacks, but since then, we’ve revised the board and readjust ourselves. We’re a professionally run company, so there’s no conflict in how we operate.”

The survival of lava is crucial when the government tries to show the world the Indian electronics brand and creates higher value in the domestic electronics market – currently focusing on low-cost, quality-scale assembly and repackaging of white label devices brought from abroad. Lava is also the only surviving Indian smartphone brand, which has surpassed the Chinese shock in the Indian market since a decade ago, bringing people like Xiaomi and Oppo to India.

However, analysts have different views on lava. Senior analyst at a senior market research firm, who has asked to be anonymous since working closely with the company, said Lava’s goal to gain 10% market share in the industry by 2030, “is a tough, tough scale order.”

“The smartphone market is very stagnant in India, and industry stakeholders realize that feature users in India may not necessarily be a customer base, it will immediately turn to smartphones,” the analyst said. “In fact, this approach has been around for a while. So the real growth of lava will come from major users – but any user buys a second smartphone or will be better than the basic ones below in the future. ₹10,000. But it’s a very stagnant segment – will such a steep growth come from here? ”

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Data from Counterpoint shows that lava has a market share of 1% in India in 2024. Between 2022 and 2024, the domestic smartphone market will expand at a compound annualized rate of 1.5%. Raina Project Lava will reach 10% market share by 2030. Compared to the current 10%, it will require an increase of nearly 60% per year.

But Tarun Pathak, research director at Counterpoint, believes there is a possibility of growth. “While the forecast may be too high, offline retailers and customers have good feedback on the brand’s revival. What Lava needs is a strong marketing campaign that can get rid of the previous brand image and create a new one that demonstrates its potential to showcase its neck against Samsung, Xiaomi and others.”

Between 2022 and 2024, the domestic smartphone market will grow at an annualized rate of 1.5%.

According to Pathak, the equipment of the lava provides good quality. “But what lava really needs is a kind of hook, like Samsung’s advanced gaming, Xiaomi’s camera focus or Oppo’s reliable marketing strategy.”

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With the help of program fundraising and expansion, Lava Eyes has a place in the major leagues. While stagnant markets threaten to play with disruptors, lava is not just focusing on smartphones to boost revenue and profit margins.

“We have our own assembly plant and can only benefit from the component plans in the center. This also gives us some advantages, and we can also make for other brands, like we did at Nokia before,” Raina said. “This can provide more revenue for us as a technology group. We also want to create our own IP, start with software design, and invest heavily to show our brand value to our customers.”