Xiaomi remained the top vendor in India’s smartphone market in the third quarter of 2018, though the overall market struggled to grow, according to a report by research firm Canalys. Xiaomi had a record run of 12 million shipments, which helped it gain 29.8 per cent market share in India. This puts the OEM well ahead of number two player Samsung, which had 23 per cent share and 9.3 million shipments.
Canalys’ numbers show Xiaomi grew by more than 30% year on year in the third quarter. Vivo and Oppo came third and fourth respectively with shipments of 4.5 million and 3.6 million. Oppo branded phones saw their shipments decline by 24 per cent. However, Oppo’s sub-brand RealMe had a strong performance with 800,000 units shipments.
Finally, Micromax was the surprise re-entry at number five with 2.6 million shipments. But this performance was due to a government order from Chhattisgarh state, where, along with Reliance Jio, it will provide smartphones for a fixed price of Rs 2,510 to 5 million women and college students. Data from another research firm Counterpoint had also marked the return of Micromax to the top five for the very same reason, though the momentum is unlikely to continue for the Indian brand.
Overall though the smartphone market in India declined by 1% year on year to 40.4 million units. Canalys notes that one reason for this was Diwali falling in the fourth quarter, and this effectively slowed shipments in Q3.
Further the firm cautions that there are multiple macro-economic factors which will negatively impact the global smartphone market, including India. The rise of the US dollar and the fall of the rupee is one major factor, which will have a negative impact.
“The rising value of the US dollar is the number one concern for smartphone vendors. Both the Chinese yuan and Indian rupee continue to slide against the dollar, directly affecting material costs. For Chinese vendors that operate on razor-thin margins, price corrections are well in order, and these price hikes will hurt growth in India, among other markets,” Canalys Research Manager Rushabh Doshi said.
Another macro-economic factor mentioned by Canalys is the price of crude oil, which has risen to $86 per barrel in October 2018.
“As vendors consider a much-needed correction in market prices, they will also need to contend with rising oil prices in India, which are likely to stoke inflation, effectively shrinking the average consumer’s expendable income. These two factors will stifle market growth from opposite ends,” Doshi added.
Further, the Indian government is expected to add import duties on some smartphone components as it seeks to push local manufacturing, which could impact margins.