HP India is currently in talks with VVDN Technologies and Dixon Technologies to assemble its laptops in the country, according to sources. The India arm of the American laptop maker is one of the 27 companies eligible for the PLI scheme 2.0 for IT hardware, for which $2 billion have 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 said 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 jobwork. When contacted, spokespersons for HP India, VVDN Technologies, and Dixon did not respond to queries regarding these negotiations. 

Both VVDN Technologies and Dixon Technologies are already collaborating with global chipmaker Intel, which provides them with key technological insights to establish a robust laptop manufacturing industry in India. Other Intel collaborators 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 home-grown 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 $2.5 billion 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 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.

(Source: Business Standard)