Smartphone shipments in India declined 5 per cent year on year to 47.5 million units in Q3, as vendors struggled with supply issues for low-end models, according to a report by Canalys.

However, it is to be noted that owing to pent up demand last year, Q3 2020 makes for a tough year-on-year compare.

Shipments in Q3 2021 were 47 per cent higher compared to Q2 2021, as consumer demand bounced back rapidly owing to declining Covid-19 cases.

"Vaccine roll-out has been colossal for the Indian economy,” said Canalys Analyst Sanyam Chaurasia.

“From the end of June, a surge in demand has swept India, which is set to persist during the festive season. Smartphone vendors have seized the opportunity to push the older stock into the channel ahead of the holiday period. But low-end model supply constraints mean shipments have been restricted, and brands have been forced to use promotions to make their high-end models more appealing," Chaurasia said.

According to Chaurasia, these challenges are likely to persist In Q4 with high component and logistics costs, together with container shortages leading to longer lead times and higher retail prices.

"But smartphone brands are striving to minimise the impact on Indian customers and will prioritise online channels where possible to provide a margin buffer that may allow for less price disruption," Chaurasia said.

Market share

Xiaomi maintained its lead in the Indian smartphone market, shipping 11.2 million units for a 24 per cent market share. Samsung maintained the second spot with 9.1 million units, accounting for 19 per cent of the market. It was followed by Vivo with 8.1 million shipments, accounting for a 17 per cent market share. Realme remained in fourth place with 7.5 million units and a 16 per cent market share while OPPO came in fifth with 6.2 million units shipped and a 13 per cent market share.

“The fight for market share intensifies further in India,” said Canalys Research Analyst Jash Shah.

“Smartphone vendors are using a range of strategies, from extending their product mix to boosting their channel coverage, to increase shipments and value," said Shah.

For instance, Xiaomi leveraged its Mi 11 series to raise its share in the premium segment, despite a slight drop in share overall, as ler Shah. Its primary competitor Apple for high-end share, used promotional deals to gain momentum into iPhone 12 sales ahead of its iPhone 13 launch in September.

However, Realme opted for a different strategy, hoping to undermine high-end vendors with its focus on affordable 5G. Its shipments were 70 per cent online, and it shipped around one million of its Realme 8 5G, Shah said.

"Competition is unlikely to let up anytime soon, as challenger brands such as Transsion attempt to scale up and disrupt incumbents in India,” Shah further added.

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