BBK Electronics Restructures India Operations, Separates Oppo, OnePlus, and Realme

Industry insiders explained that BBK is being cautious due to the current government crackdown on Chinese companies. They believe that any severe actions against Oppo Mobiles India could have a detrimental impact on the business operations of these three prominent brands. Consequently, the company has taken the proactive step of separating its businesses.

Highlights

  • China's leading smartphone manufacturer, BBK Electronics Corp, has implemented a strategic restructuring of its operations in India.
  • The company has transformed three of its major brands - Oppo, OnePlus, and Realme - into independent entities with their own sales accounting.
  • The primary objective behind this move is to mitigate potential risks associated with government actions targeting Chinese companies.

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BBK Electronics

China's leading smartphone manufacturer, BBK Electronics Corp, has implemented a strategic restructuring of its operations in India. According to an ET report, the company has transformed three of its major brands - Oppo, OnePlus, and Realme - into independent entities with their own sales accounting. The primary objective behind this move is to mitigate potential risks associated with government actions targeting Chinese companies. By establishing separate legal entities for OnePlus and Realme, BBK aims to safeguard these brands from any adverse measures taken against Oppo Mobiles India, which previously handled sales and distribution for all three brands.




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Industry insiders explained that BBK is being cautious due to the current government crackdown on Chinese companies. They believe that any severe actions against Oppo Mobiles India could have a detrimental impact on the business operations of these three prominent brands. Consequently, the company has taken the proactive step of separating its businesses.

In May, Oppo Mobiles India submitted regulatory filings to the Registrar of Companies (RoC), disclosing extensive government actions against the company. These actions included freezing bank accounts with funds amounting to Rs 2,082 crore. Additionally, the company's auditors expressed concerns over its ability to continue as a going concern, citing "material uncertainty." Oppo Mobiles India was already under scrutiny for alleged customs duty evasion totalling Rs 4,388 crore.

To address the challenges, Oppo Mobiles India stated in its filings that it has received letters of intent from its holding company and external commercial borrowing provider, indicating continued financial support to ensure operational continuity. While the company has submitted its financial report for the fiscal year 2021-22, it has not provided subsequent filings, including the financial and auditor reports for FY23.

OnePlus and Realme are exploring partnerships with Indian contract manufacturers in response to government requests. OnePlus Technology India has commenced signing billing, sales, and distribution agreements with prominent retail chains and their distributors this month, while Realme Mobile Telecommunications initiated this process earlier.

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Tanuja is a passionate technology and telecom buff who has been following the telecom industry for several years now.

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