Apparently, India's overcrowded smartphone market, which is dominated by Chinese smartphone brands like Xiaomi, Oppo and Vivo among others, has not been as lucrative for the new players. Months after Chinese smartphone brand Gionee filed for bankruptcy and discontinued its operations, Vietnamese smartphone brand Mobiistar has reportedly pulled the plug on its Indian operations within a year.
According to a news report, Mobiistar started facing trouble in India after its sole manufacturing partner Vsun stopped all its production in the country following bankruptcy in China that badly affected the company's supply chain.
LinkedIn data suggests that Mobiistar India's workforce is at 186 and the majority of its employees, including Group CEO Carl Ngo and CFO Ajay Dua, have left the company. Ngo even went back to Vietnam without providing any update to Indian partners regarding the company's operations, as per the report.
Mobiistar's former CFO Ajay Dua confirmed to the publication that there were problems at the company and Ngo was in negotiations with various investors in India and Vietnam to raise funds and revive supply operations in India after Vsun backed out.
Mobiistar forayed into the Indian market in May 2018. The company solely relied on Vsun for manufacturing of its smartphones. Last month, Vsun entered bankruptcy and sacked all its employees. Experts believe India's smartphone market is expected to witness more such exits than entries from small-scale brands in the coming months.
Last year, Gionee entered bankruptcy after failing to clear dues worth 20.2 billion yuan (roughly $3 billion) to 648 creditors, half of which are banks. Recently, a Chinese court reportedly ordered Gionee's patents to be sold off to pay its debts. Trouble for Gionee worsened after the company's chairman Liu Lirong reportedly lost a 1 billion yuan (roughly $144 million) bet in a casino. Liu had reportedly borrowed company funds to gamble.