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With Rs 20 lakh, he built a Rs 350-cr business

By Indrani Roy
Last updated on: August 12, 2015 09:43 IST
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Md Gyasuddin

 

'I found my motivation in the fast emerging mobile market.'

'Nokia’s biggest mistake lay in its stubbornness to change.'

'It’s important to understand the pulse of the people.'

“To succeed in life, you need to be a dreamer and need to follow that dream with passion, hard work and dedication,” said Md Gyasuddin, top, managing director of Hitech Mobiles.

He observed this simple rule of life and today he is the owner of Rs 350-crore (Rs 3.5-billion) business.

Starting with a capital of Rs 20 lakh (Rs 2 million), it has been a long journey for him.

“At times, it seemed I was being unreasonable and foolish but never gave up,” he said.

After graduation, Gyasuddin started a small mobile import unit in Kolkata in 2002.

But he had a wider vision -- that of creating a mobile brand of his own.

After tutoring himself on the intricate details of the trade, Gyasuddin set up his own company -- Hitech Mobiles in 2008.

Over the years, the company grew steadily and is now selling almost 2 million mobile handsets a year.

It is ranked 8th among the Indian handset makers.

Recently, the company set up its assembling unit in at Merrill Logistics Park in Sankrail, Howrah.

In a candid conversation with Indrani Roy/Rediff.com, Gyasuddin talked about how he built his company, what plans he has for it, the new assembling unit among other things.

Hitech Mobiles

 

What led to the idea of launching a new brand?

From an early age, I was fascinated by mobile phones and always wanted to deal in them.

After graduation, there was tremendous pressure on me to start earning. I came from a lower-middle-class family and my father was a government employee.

There was a crunch of cash all the time. But I was unwilling to take up any ordinary job that came my way and wanted to start a business.

I wanted to import mobile handsets. As a student, I had saved some money and with that took a short trip to Hong Kong to understand the nuances of mobile handsets’ business.

On my return, I started an import unit in Kolkata in 2002. I used to import handsets made by Nokia, Samsung etc and would sell them in the local market.

What was your motivation?

I found my motivation in the fast-emerging mobile market.

Though I was only out of college I knew that the mobile market had huge opportunities and it would soon undergo a thorough transformation.

I thought if I ventured into this market now, I could build a secure future.

The road must have been tough for you. What difficulties did you face in setting up this business?

Most difficult part of my journey was accumulating funds for the business. I took loan from the bank and also from friends and relatives for starting the import unit.

With an initial capital of Rs 20 lakh (Rs 2 million), I started building the mobile import unit.

The next hurdle was manpower. It was extremely difficult to get skilled workers to run the import unit. Unable to gather enough expert hands to run the business, I hired some freshers and took the responsibility of training them myself. My import unit started giving me good returns from 2004.

This is when I started dreaming of launching a mobile brand. My dreams bore fruit in 2008. Starting with a single unit in Kolkata, Hitech now has 20 branch offices all over India -- it’s a wonderful feeling!

Hitech accessories

 

There are so many mobile brands, foreign and Indian, in the market. Why do you think people buy Hitech? What is its unique selling proposition?

We have consciously tried to keep prices of our mobile handsets within affordable limits. The price ranges between Rs 2,000 and Rs 8,000. Recently, we launched a mobile handset that costs Rs 599 only. We are sure it will be a major hit among the first-time buyers.

Also, we take pride in our highly professional after-sales service units, numbering 350, spread across India. We believe in our customers’ brand loyalty and ensure that they never get a chance to complain.

Which countries do you export your products to at present?

We mainly export our products to Nepal, Bangladesh and Bhutan at the moment. But we do plan to reach out to other countries soon.

Who is your target group?

Mobiles that we make are meant for younger generation between 18 and 30 years of age. Our mobiles are meant for those who want maximum features at minimum prices. We cater mainly to those who have been initiated on to the world of smart phones.

Hitech is ranked 8th among Indian mobile handset makers. How do you plan to beat your competitors?

As I said before, no other mobile handset maker but us can offer so many features at such affordable prices. Besides, our research and development team is constantly experimenting with new ideas to make our products unique.

At present, 30-40 per cent of our revenue is accrued from the sales of smartphones and the rest from the sales of conventional handsets. I hope it will take us a few more years to reverse the trend.

During a media interaction you had said that you learnt a lot from what happened to Nokia. Could you please elaborate?

I think Nokia’s biggest mistake lay in its stubbornness to change. Nokia never took its competitors seriously and it stuck to its Symbian operating system. But as India moved on to smart phones with the advent of 3G, people opted for Android, which was the cheaper option.

Samsung and Google grabbed this opportunity and soon Nokia found itself getting irrelevant. We saw in Nokia’s case a great business lesson.

Hence, we have vowed to ourselves to keep surveying the market and keep adapting ourselves to the changing needs of time.

Hitech MD Md Gyasuddin

 

Why did you venture into accessories’ production?

Soon after launching Hitech, we discovered that the modern market was crazy about mobile accessories. A new product was hitting the stores almost on a daily basis. We also noticed that the prices of these accessories were too high.

Hence, we thought of manufacturing accessories that will be user-friendly as well as affordable. Over the last few years, Hitech’s accessories have been a major hit. In fact, our accessories’ sales alone have added as much as Rs 150 crore (Rs 1.5 billion) to the revenues.

Tell us about your new assembling unit in Howrah.

The main motto of Hitech is to produce multi-featured mobiles at reasonable prices. The assembling unit will work towards this end. This 24,000-square foot unit set up at a cost of Rs 15-20 crore (Rs 150-200 million) will employ more than 200 people. The unit will house 11 machines, 4 assembly lines, one quality testing line and one packaging line.

We are collaborating with our Chinese partners, Shenzhen Yiheyuan Technology Company Limited, for mobiles and Shenzhen Hi-Tech Electronic Industrial Co. Ltd for accessories.

In tune with Prime Minister Narendra Modi’s ‘Make in India’ theme, we intend to make high quality handsets that will be smart enough to compete with any of the global brands.

It’s often said that West Bengal has a very poor industrial prospects. Even then, why did you choose this state to set up your assembling unit?

I think it’s unfair to be negative about anything without trying out all the possibilities. Since I am born and brought up in this city, I have always felt I should give something back to Kolkata. Besides, starting a business in Kolkata or in any part of Bengal has its advantages. Here labour comes cheap and as there are not many factories, there is less competition.

Hitech does brisk business in mostly non-metro cities. Have you intentionally avoided expanding your business in the metros? If so why?

Business response from non-metros so far has been enormous. In fact, these are the places where we get maximum number of buyers.

However, we do have plans for expanding in the metros. We are waiting for the goods and services tax to be implemented.

For, it will be a lot easier for us to chalk out an expansion plan when we have a unified tax regime.

What are your plans for expansion?

Talks are on to start business in Sri Lanka and some African countries. Our sales and marketing teams are very dynamic and they are constantly exploring opportunities so that our business can grow.

Having tasted such amazing success, what would be your message to budding entrepreneurs?

There are three pillars of success -- hard work, honesty and perseverance.

Moreover, it’s important to understand the pulse of the people. One should always be aware of the market demand. If one sees a spark somewhere, one must stoke it.

An opportunity does not always come knocking. One often needs to convert a feeble chance into a huge opportunity.

Photographs courtesy: Hitech Mobiles.

 

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Indrani Roy / Rediff.com in Kolkata
 

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