Indian smartphone market to rebound in 2021 after decline in 2020

After several years of growth, the Indian smartphone market declined by 1.7 per cent year-on-year in 2020. Due to COVID-19 pandemic, Indian smartphone market exited 2020 at 150 million units, says IDC. However, the need for upgrades is likely to push towards a stronger market acceleration in 2021.

The factors including stay-at-home mandates, remote work, remote education, travel restrictions, and manufacturing shutdowns, led to a sluggish January-June period with 26 per cent YoY decline that particularly impacted April-June quarter, 2020. However, as markets reopened gradually, July-December period showed recovery with 19 per cent YoY growth.

Lockdowns and restrictions rendered an urgent need for devices supporting activities such as entertainment, work from home, and remote learning, resulting in more devices per household, and leading to a resurgence in demand for consumer devices including smartphones, consumer notebooks, and tablets in 2020. October-December quarter posted record fourth-quarter smartphone shipments of 45 million devices, with 21 per cent YoY growth.

"The rebound of the smartphone market in the latter half of 2020 underscores the importance of devices in our day-to-day lives. In 2021, IDC expects the smartphone market to grow in high single-digit YoY, driven majorly by upgrading consumers, in the mid-range segment and affordable 5G offerings (US$250). Also, revamped offline channel play is anticipated, to bring back growth in the very important brick and mortar counters for long term sustainability," says Navkendar Singh, Research Director, Client Devices & IPDS, IDC India.

Demand for 5G-enabled smartphones

5G smartphone shipments crossed 3 million in 2020, with Chinese OEMs rolling out aggressively-priced devices through 2020. But adoption was limited by higher prices and the lack of a 5G network, which is expected to start to roll out in late 2021 or early 2022.

"As more 5G devices enter in 2021, the ASP for smartphones is expected to rise. IDC expects vendors to launch 5G devices at multiple price points backed by aggressive promotions, as 5G currently remains a novelty rather than a necessity to most," says Upasana Joshi, Associate Research Manager, Client Devices, IDC India.

On the market share front for the year 2020, Xiaomi once again emerged as the leader with 27 per cent market share followed by Samsung at 20 per cent driven by Galaxy M and newly launched F series. With 18 per cent market share, Vivo was at the third spot primarily on the back of its affordable Y series along with marketing and promotional activities.

Realme was at the fourth position at 13 per cent market share with 19 million annual shipments followed by OPPO with 11 per cent. Others, accounting 11 per cent included Transsion and Apple. Cupertino giant Apple too exited 2020 with YoY growth of 93 per cent, driven by previous generation products like the iPhone 11, iPhone SE (2020), and iPhone XR, even as the new iPhone 12 series had a strong pickup in the fourth quarter.

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