Chennai: Foxconn group's subsidiary Bharat FIH is shutting down its operations at Sri City in Andhra Pradesh due to reduced orders from a key client, Xiaomi. As per a knowledgeable source, the department ceased its level 10 activities on June 30, with certain operations being moved to Sriperumbudur close to Chennai. The company's plans to launch a Rs 5,000 crore IPO may be impacted by this.
The main activities of the Sriperumbudur unit include assembling, testing, marking, and packaging for specific segments. Reports from the media stated that three independent directors, including InterGlobe Aviation chairman Venkataramani Sumantran, Sify Technologies co-founder Ramaraj R, and former IT and telecom secretary Aruna Sundararajan, have left the company.
The company relied too heavily on Xiaomi and Nokia and did not branch out according to market trends. Additionally, the source mentioned that the Foxconn Group is overly concentrated on the manufacturing of Apple products. The company was ineligible for the production-linked incentive (PLI) scheme as its devices were priced at less than Rs 15,000 each.
The previous year, Bharat FIH had announced plans to invest approximately Rs 400 crore in its subsidiary Rising Stars Hi-Tech. Bharat FIH, which is a part of FIH Mobiles and a Foxconn Technology Group affiliate, had plans to launch an IPO in the previous year. The decline in business has now disrupted these plans. The initial public offering (IPO) consisted of Bharat FIH's share sale, which involved a new issuance of shares amounting to Rs 2,502 crore and a sale offer of up to Rs 2,502 crore by the promoter group and Foxconn unit Wonderful Stars.
Shortly after, the company diversified its expertise to include the production of casings, mechanical parts, and components, as well as printed circuit board assembly (PCBA) and the final assembly of mobile devices. After Covid, Bharat FIH's workforce exceeded 25,000 employees, with 90 percent being female.
Josh Foulger, who served as country head of Bharat FIH, made an interesting exit from the company in January 2024 after nine years. Foulger played a crucial role in Bharat FIH's growth in India and was also pivotal in the success of its client Xiaomi Corp.
ALSO READ: CM discusses on flood, health, career and industry
FIRST Business Portal addressing the potential of business capability of North East Region.
