Made in India smartphone shipments exceeded 52 million in Q3 2022: Oppo controls nearly one-fourth of the market

The "Made in India" smartphone shipments declined a notable 8% YoY in Q3 2022, reaching over 52 million units. However, this was the first YoY decline of 2022. Let's understand what is causing the decline in shipments of smartphones that are made in India, despite the government’s push for local manufacturing and holiday season's discounts and offers.

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The demand for smartphones in India has declined during the third quarter of the year. Almost all the brands were affected, particularly those in the entry-level and budget segments. According to the latest report by Counterpoint Research, the Made in India smartphone shipments declined a notable 8% YoY in Q3 2022, reaching over 52 million units. However, this was the first YoY decline of 2022.

When compared to the previous quarter, there was a significant 18.2% QoQ growth in the shipments of made in India smartphones. In Q2 2022, India shipped over 44 million units of Made-in-India devices, with a 16% YoY growth.

It is worth noting that India’s overall smartphone market witnessed a notable drop in shipments during the third quarter. The country shipped over 45 million units in Q3 2022, with a decline of 11% YoY. And this trend is expected to continue in Q4 2022. Overall, India’s smartphone shipments are expected to decline 5% YoY in 2022, marking the second decline in the last three years.

Top 5 Made-in-India smartphone brands

Oppo is the largest manufacturer of made in India smartphones, with nearly 24% share in Q3 2022. The Chinese behemoth is outpacing India’s two biggest smartphone brands, Xiaomi and Samsung, in terms of the shipments of make in India smartphones. It is important to note that OPPO not only manufactures smartphones for its own brand (OPPO) but also for realme and OnePlus in India.

Following Covid-19, the Korean giant has increased its smartphone production in India, particularly for the premium devices such as Galaxy S series. The festive season has boosted Samsung’s made in India smartphone shipments even more. As a result, the shipments increased from 16.3% share in Q3 2021 to a 20.7% share in Q3 2022. Dixon Technologies manufactures smartphones for Samsung.

Surprisingly, Xiaomi, which dominates the India’s overall market, isn’t among the top 3 made in India smartphone manufactures. This is despite the fact that the company has already established five manufacturing plants in the country. Bharat FIH, which manufactures devices for Xiaomi in India, is the fourth largest made in India smartphone manufacturer.

BYD and Lava were emerged as the fastest-growing manufacturers in terms of smartphone shipments.

Now let’s understand what is causing the decline in shipments of smartphones that are made in India?

Low demand for made-in-India smartphones or something else?

According to Senior Research Analyst Prachir Singh, two major forces impacted smartphone shipments in India. The first is a lack of consumer demand, and the second is market uncertainty.

India’s smartphone industry is showing a contraction in consumer demand, owing primarily to the unfavourable macroeconomic indicators. However, the entry-level segment saw the greatest decline in demand.

The high channel inventory at the beginning of the quarter also impacted the smartphone manufacturing during the quarter.

Despite all these challenges, India’s smartphone manufacturing ecosystem is expanding. Interestingly, in-house manufacturers accounted for nearly 63% of shipments, while third-party EMS (electronics manufacturing services) companies accounted for 37% in Q3 2022.

Additionally, the Indian government has been pushing the local manufacturing through production-led incentive (PLI) schemes. As a result, the global players like Apple and Samsung established their own manufacturing facilities in India.

Under PLI schemes for mobile phones, the government recently approved a whopping Rs 357.17 crore for Apple supplier Foxconn India and Rs 58.29 crore for Dixon Technologies subsidiary Padget Electronics.

Further, the government is leaving no stone unturned to meet the target of expanding the local value addition from its current 17-18% level to 25% in the near future.

India will become the world’s largest manufacturing hub for smartphones, sooner or later.

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