New Delhi: Smartphone shipments in India are expected to fall 5% year-on-year in 2022 to 160 million units – the second time in the past three years, according to a research report.
The report adds, however, that the market is expected to grow by 10% in 2023 to reach 175 million units.
According to data from Counterpoint Research India, in 2017 the smartphone market recorded an annual growth of around 7% with a total shipment of 158 million units. The following year saw negative growth of 4% with 152 million units. It rebounded in 2021 with an annual growth of 11% with a total shipment of 168 million units, and contracted by 5% in 2022.
Market research firm’s report says 2022 started with supply chain issues including component shortages, rising semiconductor chip prices, impact of Russian-Ukrainian war and weak global signals. However, despite the restoration of the supply chain in the first half of 2022, demand has not improved as expected.
“Weak demand was mostly felt in the entry-level and mid-range price ranges due to higher retail prices due to higher component prices and the macro inflationary environment. The premium market continued to grow in 2022 with the price range > INR 30,000 ($400) reaching a new high,” he said.
This indicates the current spending capacity of households who can only afford entry-level and mid-range smartphone brands, or budget phones.
In June, ETTelecom.com had reported that entry-level (less than Rs 5,000) and low-budget (Rs 5,000-Rs 10,000) smartphones are the most affected segments. A research analyst had told the outlet that inflationary pressure was having the biggest impact on this group of consumers.
India has over 600 million smartphone users and according to the Counterpoint Research report, this number is expected to increase over time as more and more mobile phone users migrate to smartphones.
However, another report, released in November, said the impact of inflation on consumer demand, rising device costs and the slow migration from phones to smartphones would be the main challenges for the market. Indian smartphone market in 2023.
According to the International Data Corporation, during the July-September 2022 quarter, smartphone shipments fell 10% year over year, reaching a three-year low of 43 million shipments.
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