New Delhi, Hong Kong, Seoul, London, Beijing, San Diego, Buenos Aires
Apr 27th, 2020
India’s smartphone shipments grew a modest 4% YoY to reach a little over 31 Million units in Q1 2020, according to the latest research from Counterpoint’s Market Monitor service. January and February shipments grew annually due to new launches and aggressive promotions. However, a steep annual decline in March (-19%) due to COVID-19 outbreak restricted overall quarter growth to just 4%. The nationwide lockdown was enforced by the Indian government from the last week of March and will remain in place until May 3rd. Any signs of recovery will likely only start from the third quarter onwards. As a result, we are estimating that overall smartphone shipments will decline by 10% for the full calendar year.
Commenting on the market dynamics, Prachir Singh, Senior Research Analyst at Counterpoint Research said, “The COVID-19 effect on India was relatively mild until mid-March. However, economic activities declined as people save money in expectation of an extended period of uncertainty and an almost complete lockdown. Almost all smartphone manufacturing has been suspended. Further, with the social distancing norms, factories will be running at lower capacities even after the lockdown is lifted. Consumer demand will have a larger impact on smartphone sales, as people will focus on saving and therefore limit discretionary purchases. As entry-level smartphone consumers will be the worst-hit by the lockdown, the demand for the entry-level smartphones will decline in the near-term. We believe demand will shift to the second part of the year. Even if the situation stabilizes by mid-year, people may hold-off purchasing until the festive season.”
Commenting on the competitive landscape, Shilpi Jain, Research Analyst at Counterpoint Research said, “Smartphones should be considered as essential items during the lockdown as people are dependent on them as a primary mode of communication. We believe that sales should be allowed through online channels or at least adopting an Online to Offline (O2O) model. This is happening in Europe and the USA where online channels still remain in service.”
“For OEMs, a lot of work will be needed to restart operations once the lockdown is lifted. This will range from managing existing inventory across all distributor and retail touchpoints and supporting retailers sell-through older inventory. Also, if the lockdown is lifted in phases starting with the green zone areas, OEMs will have to align their channel and sales strategies to drive sales in these non-affected areas.”
Exhibit 1: India Smartphone Market Share Q1 2020
Source: Counterpoint Research Market Monitor Q1 2020
While the smartphone market registered YoY growth, the feature phone market saw a decline of around 24% YoY in Q1 2020 implying consumers are transitioning to smartphones. Chinese brands are gaining momentum in the feature phone market, reaching a combined 33% share of total feature phone shipments, up from 17% in Q1 2019. Itel is the principal brand driving this change.
Exhibit 2: India Feature Phone Market Share Q1 2020
Source: Counterpoint Research Market Monitor Q1 2020
Market Summary:
The comprehensive and in-depth Q1 2020 Market Monitor is available for subscribing clients. Please feel free to contact us at press(at)counterpointresearch.com for further questions regarding our in-depth latest research, insights, or press inquiries.
The Market Monitor research is based on sell-in (shipments) estimates based on vendor’s IR results, vendor polling, triangulated with sell-through (sales), supply chain checks, and secondary research.
You can also visit our Data Section (updated quarterly) to view the smartphone market share Globally and from the USA, China , and India.
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