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India’s smartphone market saw decline in third quarter, supply constraint to blame: IDC

The Indian smartphone market saw a yearly decline of 12 per cent in the third quarter of 2021 (July-September), data from International Data Corporation (IDC) showed

By: Tech Desk | Chandigarh |
November 12, 2021 4:50:42 pm
motorola, xiaomi, phones to launch in 2022, smartphones launch in 2022, xiaomi phones in 2022, samsung phones in 2023(Image of Redmi Note 10 used for representational purposes)

The Indian smartphone market saw a yearly decline of 12 per cent in the third quarter of 2021 (July-September), data from International Data Corporation (IDC) showed. The research firm expects the Indian smartphone market to end 2021 with just single-digit growth given the ongoing supply constraint which is impacting the chip industry and therefore the smartphone industry as well.

“Due to supply challenges, the fourth quarter is expected to see a decline, resulting in annual shipments below 160 million in 2021. The first half of 2022 will remain challenging, with some easing out expected in the latter half of 2022. Vendors/channels will keep an eye on the over-stocking situation in case demand stays limited due to the price hikes by the suppliers and vendors,” Navkendar Singh, Research Director for Client Devices & IPDS, IDC India said in a press statement.

IDC blames the component shortages as well as an unusually high third quarter comparison base for the decline. This is because last year’s third quarter (July-September 2020) was when the pent-up demand from the first phase of lockdowns was addressed so it had seen an unnaturally high boost.

While online channels clocked a record high 52 per cent share, they also saw a 5 per cent yearly shipment volume decline. Meanwhile, offline channels registered an 18 per cent yearly shipment decline. IDC expects online shipments to surpass offline shipments in 2021.

Further, India was the third-largest 5G smartphone market globally with 7 per cent of worldwide 5G shipments at 10 million units being made available at an ASP (average selling price) of $401. In total, 17 million 5G smartphones were shipped to India till September 2021, and the number is expected to be under 30 million by the end of  2021. The OnePlus Nord CE, iPhone 12, and Galaxy A22 were the most popular 5G models in the third quarter, IDC’s report said.

Another crucial aspect was that the ASP, which hit $196, though this was also driven by price hikes and more 5G phones. According to IDC, the sub-$200 segment dropped by 24 per cent, while $200+ smartphones grew by 56 per cent, signaling a shift to higher price buckets, driven primarily by supply.

“IDC believes that a growing dependency on smartphones triggered by remote work and learning, as well as a subsequent requirement for better quality hardware is pushing consumers to spend more. With continued chip shortages and logistics costs, brands are also compelled to expand upwards in terms of price points across channels,” Upasana Joshi, Research Manager, Client Devices, IDC India said.

Top 5 Smartphone Vendors in India

While Xiaomi continues to lead, it saw shipments fall by 17 per cent on an yearly basis, though Poco saw a growth of 65 per cent. The Redmi 9A/9 Power/9/Note10s were the major volume drivers along with the Poco M3 and Poco C3.

Samsung continued to hold the second spot but saw the highest yearly decline among the top five players at 33 per cent. The Galaxy M and F series were the major drivers and nearly 49 per cent of shipments were sold online. Samsung is in the leadership position in the 5G segment thanks to its new devices.

vivo was at the third position, with a shipment decline of 13 per cent yearly, though it strengthened its portfolio in the $200-300 segment with its V and iQOO series.

realme was number four and actually had the best performance of the top 5 vendors with a yearly decline of just 5 per cent. The C11 (2021) and realme 8 were the highest shipped devices. Oppo grabbed the fifth spot with a decline of 16 per cent on a yearly basis. However, Oppo did better in the $300-500 segment rising to the second spot with an 18 per cent share driven by the Reno 6 series.

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