The share of Chinese brands in India’s smartphone market dropped to 72% in the quarter ended June 30, compared to a peak of 81% in the first three months of this year, market researcher Counterpoint Research said, as leading brands such as Oppo, Vivo and Realme faced a supply crunch amid rising anti-China sentiment.
The fall in market share came on the back of a big decline in smartphone shipments during the quarter, which fell 51% year-on-year to just over 18 million units, as manufacturing facilities and sales were suspended during the first 40 days of the lockdown, it added.
“The Covid-19 pandemic wiped out almost 40 days of production as well as the sales of smartphones due to the nationwide lockdown,” said Prachir Singh, Senior Research Analyst at Counterpoint Research, adding that sale of smartphones surged once the lockdown was lifted.
By June, smartphone sales recovered, registering only a 0.3% decline on a yearly basis.
Samsung was the biggest beneficiary in terms of clawing back market share.
The South Korean smartphone maker recorded 26% market share in the April-June period, compared to just 16% in the first quarter of the calendar year.
The biggest losers included Realme, which saw its share drop to 11% in the second quarter from 14% in the first, and Oppo, whose market share plunged to 9%, compared to 12% in the January-March quarter.
“This was mainly due to the mixture of stuttering supply for some major Chinese brands such as Oppo, Vivo and Realme, and growing anti-China sentiment that was compounded by stringent actions taken by the government to ban more than 50 apps of Chinese origin and delay the import of goods from China amid extra scrutiny,” said Shilpi Jain, Research Analyst at Counterpoint Research.
However, the attractive value-for-money and strong channel entrenchment of Chinese smartphone brands in India, leaves few other options for consumers.
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Counterpoint said the current scenario was an opportunity for brands such as Samsung and also local players such as Lava and Micromax to gain market share.
E-commerce, which made up 45% of all sales of smartphones in the April-June quarter, its highest ever level, did not witness a very noticeable movement away from Chinese brands. Online retail industry executives told ET that said that there were hardly any non-Chinese options for consumers in the smartphone segment.
“What other options do consumers have? There’s Samsung and Apple, but that’s about it. In the sub-Rs 15,000 market, which is the most popular category, the offerings from the Chinese are so much better and more abundant that consumers even if they wanted to boycott Chinese goods, can’t,” said a senior executive who asked not to be named.
Unlike in categories where the Chinese contribution is not so high, consumers have been looking for ‘Made in India’ products, following the Prime Minister’s call to support local businesses in May. Further movement in this direction was seen after border tensions flared up between India and China in June.
“A lot of people are searching for ‘Made in India products, that’s clear, but in smartphones they don’t really find anything that fits that bill,” added another ecommerce executive.
While the shift away from Chinese smartphone brands might not be sustainable unless more Indian and non-Chinese brands step up, the overall smartphone market did see one big positive during the quarter — India’s overall smartphone user base grew to over 500 million for the first time.