• India Premium segment (>₹30,000, US$465, Retail Price) grew record 180% YoY during Q3 2017 due to the strong performance of Apple, OnePlus & Samsung which grew the overall size of the premium segment.
  

  Three brands, Apple, OnePlus and Samsung together controlled 98% of the total shipments in the premium segment.

• OnePlus is the new entrant in the segment and immediately captured a third of the segment breaking the Apple and Samsung duopoly.

Exhibit 1: Indian Smartphone Premium Segment by Brands Share - Q3 2017

• Most of the growth for OnePlus came from attracting Android users (which is 97% of the market) away from Samsung with a stronger alternate high-spec well-built Android alternative offering.
• Apple still held a strong play in the premium segment leading with 35% share almost flat annually though down from its peak of 59% in the holiday season quarter of 2016.
• We are seeing a significant shift from users who use to buy between ₹15,000-₹30,000 segment preferring to spend above ₹30,000 for a premium spec but affordable devices such as OnePlus 5 or older generation iPhones.
• Samsung was slightly behind OnePlus capturing the third spot with some popularity of Galaxy S8 series which were unique in terms of its gorgeous Super-AMOLED curved 18:9 full display.
• In coming quarters, however, will witness a number of flagships with 18:9 display from competition including iPhone X which will challenge Samsung further in the premium segment.
• Premium segment though contributes to just 3% of the total smartphone shipments in India but contributes to 13% of the total shipment revenues is important for any brand to create a halo-effect to drive the entire portfolio.
• Further, in a mobile-first country like India, bulk of the 350 million smartphone users will be upgrading to their third or fourth smartphone and thus the demand has been shifting to higher price bands and we believe ₹30,000+ smartphones demand will also continue to rise.
• Xiaomi & Google will be other two brands to watch out for battling in the premium segment Mi Mix 2 and Pixel series respectively.
  

  Exhibit 2: Indian Smartphone Premium Segment: Best Selling Models - Q3 2017

  

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