India's smartphone market stagnates after marginal growth in 2023: IDC

India's smartphone market stagnates after marginal growth in 2023: IDC 

The International Data Corporation (IDC) has estimated a flat to low single-digit annual growth for India's smartphone market in 2024. This follows a nominal 1 per cent growth YoY (year-over-year) in 2023, with 146 million smartphones shipped. Despite a sharp 10 per cent decline in the first half of 2023, the market rebounded with an 11 per cent YoY growth in 2H23 and a 26 per cent YoY growth in 4Q23, thanks to stronger-than-expected shipments and several new model launches.

However, consumer demand remained stressed, leading to excess inventory levels across channels despite price corrections and schemes by vendors. The ASP (average selling price) hit a record of US$255, rising 14 per cent YoY in 2023, marking the third consecutive year of double-digit ASP growth. This high ASP, attributed to the increasing share of the premium segment (US$600+) and a rapid uptake in 5G shipments, has restricted the smartphone market recovery.

"Most brands chose to reduce prices and offer additional channel margins in the last quarter to manage the inventory levels from the post-festive cyclic dip. This will give a lukewarm start to 2024 with cautious stocking by the channels," said Upasana Joshi, Research Manager, Client Devices, IDC India.

Key Highlights for 2023:

- Shipments to online channels dropped by 6 per cent, with its share dropping to 49 per cent in 2023, down from 53 per cent in 2022. Offline channel shipments grew by 8 per cent YoY as vendors strengthened their retail presence with lucrative premium offerings and expansion into smaller towns and cities.

Price segment leaders:

- The entry-level (sub-US$100) segment grew by 12 per cent YoY to 20 per cent share, up from 18 per cent a year ago. Xiaomi continued to lead, with POCO and Samsung emerging in the top brand list.
- Shipments to the mass budget (US$100 - The entry-premium (US$200 - The mid-premium segment (US$400 - The premium segment (US$600 - The super-premium segment (US$800+) registered the highest growth of 86 per cent, with its share up from 4 per cent to 7 per cent. The iPhone14/13/14 Plus together accounted for 54 per cent of shipments, followed by the Galaxy S23+/S23/S22+/S23 Ultra with 22 per cent share. Overall, Apple led the segment with a share of 68 per cent, followed by Samsung at 30 per cent.

5G and foldable phones:

- 79 million 5G smartphones were shipped in 2023, with a plethora of launches in the mass budget segment. 5G ASPs dropped to US$374, a decline of 5 per cent YoY in 2023. Within 5G shipments, the mass budget (US$100 - Almost a million shipments of foldable phones were shipped, with ASPs declining by 4 per cent at US$1,236. Samsung led the foldable phone market, although its share dropped to 73 per cent in 2023 as other players such as Motorola, Tecno, OnePlus, and OPPO have entered India’s foldable market.

Chipset Market Share

The share of MediaTek-based smartphones increased to 50 per cent, growing by 6 per cent YoY. vivo’s T2x, Xiaomi’s Redmi A2, and Realme’s C55 were the highest shipped MediaTek-based models. Qualcomm’s share dropped to 25 per cent.