India Smartphone Market Remained Flat YoY in 3Q23 with 44 Million Units, Says IDC

INDIA – According to the International Data Corporation ’s (IDC) Worldwide Quarterly Mobile Phone Tracker, India’s smartphone market remained flat YoY (year-over-year), shipping 44 million units in 3Q23. July and August registered single-digit growth as the channels started early festive stocking, but September had its lowest shipments since 2019, as tapered demand and high prices restricted growth. This came on the heels of a challenging first half of the year and a modest start to the festive season.

The ASP (average selling price) hit a high of US$253, with 5% QoQ (quarter-on-quarter) and 12% YoY growth in 3Q23. Vendors focused on affordable 5G devices and discounts across the channels. 5G smartphone shipments reached a record 58% share with 25 million units in 3Q23. 5G ASP dropped to US$357 in 3Q23, a decline of 9% YoY. The majority of 5G smartphone launches were in the mass budget (US$100<US$200) price segment, increasing the 5G share in this segment to 52% from 34% a quarter ago. Samsung’s Galaxy A14, Apple’s iPhone 13, and Xiaomi’s Redmi 12 were the highest shipped 5G models in 3Q23.

“A swift uptake in affordable 5G smartphone shipments signals bullish sentiments and success of affordability efforts of the vendors. We should expect the previous generation of premium smartphone models to be in high demand this festive season, made affordable by various offers and upfront discounts across channels,” said Upasana Joshi, Research Manager, Client Devices, IDC India.

o Entry level (sub-US$100) segment grew by 16% YoY, with 20% share

o Mass budget (US$100<US$200) segment underperformed, its share dropping to 44% from 51%, declining by 14% YoY.

o Entry-premium (US$200<US$400) segment grew by 2% YoY, with 22% share.

o Mid-premium segment (US$400<US$600) with a share of 5%, grew by 37% YoY.

o Premium segment (US$600<US$800), at 3% share, registered the highest growth of 52%, led by iPhone 13, Galaxy S23/S23 FE and the newly launched Moto Razr 40.

o Super-premium segment (US$800+) similarly registered a healthy 43% growth, with its share up from 4% to 6% in 3Q23. Apple led this segment, with 60% share, with high shipments of its iPhone13/14/14 Plus. Samsung too gained share, from 24% to 36% in 3Q23, coming from the newly launched Galaxy Z Fold5/Flip5 and Galaxy S23+/S23 Ultra.

Foldable phone shipments hit a record half million units in a single quarter, Samsung leading with 66% share. New launches by Motorola at lower price points brought the ASP of foldable phones down to US$1198 from US$1319 a year ago.

Shipments to offline channels continued to be higher than online channels, with strong double-digit growth in 3Q23. However, multiple rounds of eTailer events (The Big Billion Days on Flipkart and Amazon Great India Festival) with special platform pricing and online exclusive deals are expected to drive online demand in coming weeks.

As a brand, Samsung surpassed vivo for the leadership position, although its shipments declined YoY. Samsung had the highest ASP amongst the top five brands at US$381, growing by 43% YoY. realme climbed to the second slot, driven by the newly launched C53 and 11x. vivo (excluding iQOO), registered the highest growth amongst the top five brands, driven by affordable Y and T series models. OnePlus, with 35% of shipments driven by Nord CE3 Lite, and Poco, also had growth of 50%+ YoY.

“A range of micro financing options available on budget devices like no cost EMI offers for longer periods (from 24 to 30 months) and affordability initiatives by all major brands has given a modest start to the festive season. However, as demand softens in the latter half of the quarter (post Diwali), brands may face excess inventory challenges. Hence, the outlook for 2023 remains flat or a low single digit decline. Next year we will see a range of affordable 5G and foldable phones at the mid to premium end, but the inflationary stress and longer refresh cycles will likely limit the annual market growth in 2024,” says Navkendar Singh, AVP – Devices Research, IDC.