Nokia's super-cheap 105 handset, which retails for around £17 in China, generates as much profit for the company as its flagship smartphones, executives have revealed. Speaking at the Nokia 105 launch in China, Nokia's China platform and technology R&D director Jun Wang explained that the price of the phone wasn't an issue.

Wang pointed out that the Nokia 105 makes profit margins comparable to those of its smartphones. This is mainly because of the large quantities of phones Nokia will be expecting to sell. China is one of the biggest markets globally for affordable Android phones, so Nokia clearly wants a slice of the pie. More than 60 per cent of mobile phone sales in the country are for handsets that cost below 2,000 yuan (around £210). 

Producing Android handsets extremely cheaply is relatively difficult, simply because of the minimum processor and performance requirements for the operating system. Rarely do they fall below £32. However Nokia, by developing its own feature phones, can drive prices all the way down to £15. 

The manufacturer is known for its ability to conquer emerging markets with cheap handsets. Right now Nokia has sold more than 200 million of its 1100 feature phone globally.