India's smartphone market recorded a flat year-on-year (YoY) growth with 44 million units shipped in Q3 2023. July and August showed single-digit growth due to early festive stocking, but September experienced the lowest shipments since 2019 due to dipping demand and high costs.
Average Selling Price (ASP) 3rd Quarter Results
In the third quarter of the year, the average selling price (ASP) rose 5% quarter-on-quarter (QOQ) and 12% YoY to USD 253. The significant increase in 5G smartphone shipments, reaching a record 58% market share with a total of 25 million units, can be attributed to the availability of more affordable and discounted 5G devices from suppliers. The 5G ASP fell 9% YoY to USD 357. The 5G shipments in Q3 2023 were primarily from the mass budget price group (USD 100 to USD 200), making up 52% of the total shipments. The leading 5G models during this period were Samsung's Galaxy A14, Apple's iPhone 13, and Xiaomi's Redmi 12.
“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,” explained Upasana Joshi, Research Manager, Client Devices, IDC India.
Market Segments Performance
| Segment | YoY Growth | Market Share in Q3 2023 |
|
Entry-level (<USD 100) |
+16% | 20% |
|
Mass budget segment (USD 100 – USD 200) |
-14% | 44% (-7%) |
|
Entry-premium segment (USD 200 - USD 400) |
+2% | 22% |
|
Mid-premium segment (USD 400 - USD 600) |
+37% | 5% |
|
Premium segment (USD 600 - USD 800) |
+52% | 3% |
|
Super-premium segment (USD 800+) |
+43% | 6% (+2%) |
Global Market Share Leaders
In a single quarter, foldable phone shipments reached half a million units, and Samsung emerged as the leader with an impressive 66% market share. The introduction of new Motorola models at lower prices played a significant role in reducing the average selling price (ASP) of foldable phones, dropping from USD 1319 a year ago to USD 1198.
Despite YoY shipment declines, Samsung surpassed vivo, claiming the top spot. Realme placed second, while vivo (excluding iQOO) grew the most among the top five brands. OnePlus and POCO also reported positive YoY growth.
Despite a sluggish holiday season, the demand for smartphones has been driven by micro-financing and affordability initiatives. Nevertheless, there is a concern that, post-Diwali, demand might experience a decline. This potential decrease in demand may lead companies to grapple with excess inventory challenges, impacting the overall outlook for 2023, which is anticipated to be flat or show low single-digit growth. In 2024, inexpensive 5G and foldable phones may hit the market, but inflation and longer refresh cycles may limit annual growth.