HP India in talks with Dixon Technologies, VVDN for laptop assembly | Company News

HP India is currently in talks with VVDN Technologies and Dixon Technologies to assemble its laptops in the country, according to people in the know. The Indian arm of the American laptop maker is one of the 27 companies eligible for the PLI scheme 2.0 for IT hardware, for which Rs 17,000 crore has been earmarked as incentives.

While HP India already has its own assembly plant and a partnership with US-headquartered Flex for laptop assembly, the sources say it is seeking assembly-only deals with Sunil Vachani-led Dixon and VVDN, both of which are also eligible for production-linked incentives. Under this arrangement, HP India would provide all the components for manufacturing, a process also known as job work.

Both VVDN Technologies and Dixon Technologies are already collaborating with chipmaker Intel, which provides them with key technological insights to establish a robust laptop manufacturing industry in India. Other collaborators with Intel include Kaynes Technology, Syrma SGS, and Optimeius.

VVDN has already partnered with Hewlett Packard Enterprise (HPE) to assemble servers for the US company at its Manesar plant in Haryana. The factory is expected to produce high-end servers valued at $1 billion over the next five years.

Dixon, one of the largest homegrown electronics manufacturing services (EMS) players in India, won a contract in December 2023 to assemble both laptops and notebooks for Lenovo in India. It also assembles Motorola feature phones for HMD India, which owns the brand. In 2021, Dixon entered into a partnership to assemble Acer laptops in India.

To meet the requirements, Dixon is investing Rs 250 crore to set up a plant in Noida with the capacity to produce 1 million laptops per annum. The plant is expected to be operational soon.

In India, HP India is the largest PC player across all segments, holding a 31.5 per cent market share in 2023, according to IDC Research. It is followed by Lenovo at 16.7 per cent, Dell at 15.5 per cent, and Acer at 12.3 per cent. In the laptop segment alone, HP leads with a 33.2 per cent share, followed by Dell at 23.1 per cent and Lenovo at 14.7 per cent, according to Statista.
The Indian laptop market was valued at close to $8 billion in 2023, with 65 per cent of the units being imported, according to Counterpoint Research. The reworked PLI scheme aims to significantly reduce these imports and promote domestic manufacturing.

In focus

Indian market for laptops was at $8 billion in 2023

Out of which, 65 per cent was imported

Most imports were from China

PLI for IT hardware 2.0 has allocated Rs 16,000 crore as incentive under the scheme

27 companies are eligible under the new scheme focusing on ‘make in India’

23 of them have said they are ready to start manufacturing

First Published: May 08 2024 | 12:09 AM IST