Market research firms IDC and Counterpoint Research have both lowered their outlooks for India’s smartphone market, with sales expected to fall 13-15% this year, the first decline in history, according tomedia reports.
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The two market research institutions said the first decline in India’s smartphone market was due to the recent spate of cuts and cuts in staff wages, delays in consumer buying, the inability of companies to increase production to affect supply, and the government’s increase in the smartphone consumption and service tax (GST) to drive up prices.
IDC now expects 130 million smartphones to be sold in India, up from an earlier estimate of 140 million. And Counterpoint Research has just revised its forecast to $137 million from its previous estimate of 142 million units.
Last year, india sold between 154 million and 15.8 billion smartphones. Before the current outbreak, the two market research institutions had predicted that India’s smartphone sales would grow by nearly 10 per cent this year.
IDC said sales of feature phones are expected to fall by as much as 42 percent from 130 million last year, a drop of as much as 42 percent, as revenues from consumers of functional phones have been hit hard by the current new crown outbreak.
Navkendar Singh, research director at IDC India, said the current situation was very volatile, with prolonged closures caused by the outbreak, factories unable to operate, supply problems and consumer pessimism, which had led consumers to rush to upgrade their phones. Since 2017, he said, the market has been pushing consumers to upgrade to smartphones, but that trend has been severely impacted.
“The 10,000 rupees (10 rupees or about 1 yuan) price market will be hit, while the 10,000-25,000 rupee slot market may perform better, but it will not be able to make up for the overall decline, ” Mr Singh said.
Tarun Pathak, deputy director of Counterpoint Research, said the plant’s operating rate was only 20-30 per cent, and that might not change until the new corona outbreak eased, perhaps until July. “Unemployment is rising every month, and consumer buying may be delayed until early 2021,” he said. “
Last year, India overtook the United States to become the world’s second-largest smartphone market. The two market research institutions estimate that demand will pick up around the holiday season, but if that is not the case, India’s total mobile phone shipments will be hit further this year.
Nikhil Mathur, managing director of sales research firm GfK India, said he believed the market would pick up positively during the october-December holiday quarter.