Smartphone Shipments in India Q1 2017 – Q1 2018: The Radical Change

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Indian smartphone market is experiencing some major churning despite stagnant smartphone shipments in India during Q1 2018. More people in the country are opting for relatively economical smartphone handsets, which is quite evident from the success stories of Chinese players in the market.

Chinese newcomer Xiaomi continues to widen the market share gap in shipments with the Korean giant Samsung to claim the numero-uno position twice in a row. Oppo and Vivo took 3rd and 4th places respectively. The above top four vendors accounted for 75% of all smartphone shipments in India, while Xiaomi and Samsung booked 56% of smartphone shipments.

With 29.5 million units shipped in total, the Indian smartphone market witnessed a growth of 8% in Q1 2018, as per the data of Canalys.

The smartphone industry of India saw a major upheaval after the advent of aggressively priced high-specced handsets offered by OEMs  – specifically Xiaomi, Oppo, Lenovo, Vivo and Huawei – that are all Chinese. The scenario was no different in Q1 2018; the top brands include 3 Chinese and 1 Korean smartphone OEM. Disappointingly, the market share of Indian makers seems too low to even mention.

Smartphone Shipments In India: How Equations Changed

In 2017, people were getting to terms with the aftermath of demonetization. But that the government was about to bring the much-hyped consolidated tax GST and like every other industry the smartphone market was also bound to feel its momentum.

In the first quarter of 2017, 27 million smartphone units were shipped in the country and Indian smartphone market grew 12% YoY. Samsung, like before, continued to lead in the top 5 and shipped over 6 million units. Next in the list was Xiaomi which registered 14% of shipments in the same quarter, up from 3% a year ago, and shipped 4 million units. Vivo was third and responsible for 10% of shipments, showing a significant growth of 36% in sequential shipments.

In the second quarter of last year, the Indian smartphone market shrunk for the first time in its history, as shipments dropped 4% YoY to just under 27 million units. Samsung remained in lead with 25% market share. Xiaomi showed 4-fold growth in shipments and accounted for 4.8 Million units shipped. The Redmi maker was closing in on Samsung fast. Vivo shipped 3.4 million units – an all-time high – and stood third. Oppo secured the fourth place, while Lenovo finished fifth with 1.9 million units shipped.

Despite the wobble in Q2 2017, India’s smartphone market showed an impressive 23% growth YoY to reach over 40 million units in Q3 2017. With this, India surpassed the US to become the world’s second-largest smartphone market after China. Xiaomi and Samsung were more parallel in this quarter and contributed to almost half of the total market. The Korean giant shipped 9.4 million smartphones, almost 30% more than a year ago quarter. Xiaomi, a successful online brand managed to enter the offline market effectively while maintaining low overheads which helped it to clock 9.2 million units. Xiaomi’s impeccable growth was sure to make the closest rivals anxious.

Apple started local production earlier this year in India. Though India’s market is inclined towards low and mid-range handsets, iPhone is not a royalty anymore in the country. Apple shipped 900,000 iPhone units in Q3 2017 which was more than double compared to Q3 2016.

By now it was clear that the country will soon witness be a radical change in Smartphone shipments in India. The gap between Samsung and Xiaomi was all time narrow.

In Q4 2017, Samsung was dethroned by Xiaomi to attain the top spot in smartphone shipments. The smartphone market in the country grew by a modest 6% and the total shipments recorded were just shy of 30 million units. Samsung lost its crown and despite an annual growth of 17%, it managed to ship just over 7.3 million units. Xiaomi efforts had finally paid off, though the shipments declined from the previous quarter, it managed to record 8.2 million units. Xiaomi was the leader with 27% market share and Samsung was placed second with 25% market share. Of course, Samsung’s loss was likely justified as it failed to deliver in its low-cost lineup, an area where Xiaomi reigned.

Samsung, however, disagreed with the Canalys report of Q4 2017 and said that it still holds 45% value market share and 40% volume market share, according to a German research company GfK.

Indian Smartphone OEMs: Any Takers?

The big four of Indian smartphone makers – Micromax, Lava, Karbonn and Intex have lost considerable market share and continue to struggle with the intense competition since the beginning of 2017. The combined market share of the 4 brands by install base was 23% last year, according to CyberMedia Research.

Collectively, Xiaomi, Oppo, Lenovo, Gionee and Vivo control over 50% of India’s smartphone market now. And, in a country where the opportunity window is just too big as smartphone penetration is not even reached 50% yet, local players losing the homegrown advantage is not only surprising but sad too!


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