Revival in smartphone demand in India expected from Q3: IDC

The mobile phone market in India is expected to follow U-shaped recovery from the September quarter, with the first half continuing to see slow demand due to disruptions on account of the COVID-19 pandemic, as per research firm IDC.

The smartphone market registered 1.5 percent YoY growth in the March quarter with shipments touching 32.5 million units, IDC said in a statement.

Despite the low figure, India was the only country among the top three nations to see any growth. Both China and US markets declined 20.3 percent and 16 percent, respectively, in the said quarter.

"COVID-19 will have a substantial impact on the Indian mobile phone market in 2020, with potential supply chain disruptions and slower-than-expected consumer demand for the next few quarters," IDC India Research Director (Client Devices and IPDS) Navkendar Singh said.

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He added that the India mobile phone market is expected to follow a U-shaped recovery from September quarter onwards.

"The pent-up demand from the first half of the year will gradually shift to the second half, rolling over to 2021 as well. A revival in consumer demand is expected around the festive quarter of Q4 with amplified marketing and promotional activities," he said.

Xiaomi led the smartphone tally in the March quarter with 31.2 percent share, followed by Vivo (21 percent), Samsung (15.6 percent), Realme (13.1 percent) and Oppo (10.6 percent).

Inventories remained high throughout the distribution channels due to seasonally low demand in the first quarter, clubbed with the COVID-19 impact from mid-March onwards as the nationwide lockdown was announced, IDC said.

"The online channel grew by 9 percent YoY in Q1 2020 due to multiple new launches, attractive discounts, cashback offers, and affordability schemes registering a share of 43.1 percent.

"On the other hand, offline channel shipments declined by 3.5 percent YoY, owing to fewer consumer offers, fewer retail walk-ins, and a more aggressive portfolio available on e-tailer platforms across leading brands," IDC India Associate Research Manager (Client Devices) Upasana Joshi said.

The average selling price (ASP) grew 5.5 percent YoY to $171 (about Rs 12,900).

The sub-USD 200 segment continued to dominate, accounting for 76.2 percent of the market.

The mid-range segment of $200-300 grew 87.4 accounted for 18.2 percent of the market, while mid-premium segment of $300-500 accounted for 3.8 percent share.

In the premium (over $500) segment, Apple continued to dominate with a market share of 62.7 percent, followed by Samsung and OnePlus.

The feature phone segment, which still accounts for 41.2 percent of the overall mobile phone market in India, continued to decline YoY and registered shipment of 22.8 million units in the first quarter.