The Indian smartphone market started 2021 on a good note, showing 18 per cent year-on-year growth in the first quarter, with shipments totalling 38 million units. However, shipments did decline by a strong 14 per cent when compared to Q4 2020. A new report by IDC suggests that the onset of the second wave of Covid-19 infections has subdued customer demand.
This could result in the inventory cycle which had shrunk in H2 2020, to get longer since mid-Q1 2021. “The April-June quarter is expected to face growth challenges under the weight of the second wave of infections. However, the high shipments from the first quarter should be able to suffice for the immediate demand,” Navkendar Singh, Research Director, Client Devices & IPDS, IDC India said.
“But IDC estimates the impact to be less pronounced compared with last year, with factories being operational today and only limited restrictions on logistics/transportation and state-level lockdowns instead of a nationwide lockdown”, Singh adds.
“The recovery in 2021 might not be as smooth as expected earlier, with uncertainty around the lasting impact of the second wave and a possible third wave in the next few months. IDC expects a rebound in consumer sentiments in the second half of 2021, resulting in a single-digit growth annually. However, the degree of growth will be restricted due to reduced discretionary spending, supply constraints, and anticipated price hikes in components in upcoming quarters,” Singh further adds.
Key market trends for Q1 2021
Online channels continued their growth momentum ahead of the overall market at 25 per cent year-on-year, despite a slip in its share to 46 per cent quarter-over-quarter, while offline channels grew at 13 per cent year-on-year. However, both channels started to face higher channel inventory towards the second half of the quarter.
MediaTek-based smartphone shipments continued to lead for three consecutive quarters with a share of 52 per cent, widening the gap with Qualcomm, which had a 35 per cent share.
Almost 7 per cent of overall shipments were 5G, leading to a 3 per cent year-on-year increase in ASP to $176. Further, the premium segment grew 143 per cent year-on-year, with 71 per cent of those based on 5G. Apple, Samsung, and OnePlus continued to dominate in that space; the iPhone 11 and 12 together accounted for 28 per cent of shipments; followed by the debut of the Galaxy S21 series and the OnePlus 9 series.
Meanwhile, feature phone shipments declined by 8 per cent year-on-year, despite Reliance Jio launching its new 4G device bundled with telco offers. However, the 2G segment witnessed 3 per cent growth driven by brands iTel and Lava.
Xiaomi leads India’s smartphone market
Xiaomi continued to lead the market, despite only posting 3 per cent year-on-year growth. Three of the top 5 models were the Redmi 9/9A/9 Power, accounting for 10 per cent of the overall shipments. The Mi10i was the leading 5G model in Q1 2021. POCO, Xiaomi’s sub-brand, continued to cement its online position, driven by affordable models like POCO C3 and M3. Also, the top 8 online models were from Xiaomi/POCO, with a 30 per cent contribution.
Samsung retained its second spot, with 43 per cent year-on-year growth in Q1 2021. Online channels accounted for 41 per cent of its shipments, growing by 55 per cent year-on-year, while its offline channels continued to witness slower growth despite the new launches during March.
Vivo was in the third position, with shipments declining by 3 per cent year-on-year. However, it continued to maintain its lead in the offline channel with a 29 per cent share, ahead of Samsung.
Oppo regained its fourth slot with shipment growth of 35 per cent in Q1 2021. Its affordable A15 series featured in the highest shipped models nationally, along with newly launched 5G models accounting for 8 per cent of Oppo’s shipments.
Realme slipped to the fifth slot after falling 4 per cent year-on-year in Q1 2021. The brand continued to be the third-largest online brand with a 16 per cent share and more than two-thirds of its shipments going through the online channel.