India’s smartphone shipment will fall 10 laptop or computer in 2020, says Counterpoint research
Smartphone shipment in the united states is expected to decline by 10 per cent in 2020 due to the coronavirus pandemic, according to Counterpoint Research.
The January-March quarter saw smartphone shipment growing at modest 4 % with over 31 million units.
The report said January and February shipment grew annually due to new launches and aggressive promotions, but a steep 19 per cent decline in March - due to COVID-19 outbreak - restricted overall growth in the quarter to just 4 %.
The government has imposed a nationwide lockdown till May 3 and “any signs of recovery will likely only start from the third quarter onwards”, Counterpoint said.
“Because of this, we are estimating that overall smartphone shipments will decline by 10 % for the full twelve months,” Counterpoint said.
The Indian smartphone market surpassed the united states for the first time on an twelve-monthly level with shipment of 158 million units in 2019, a rise 7 % over the previous year.
Counterpoint added that the recent GST hike on cell phones (from 12 % to 18 per cent) will also have an impact on margins and new launches of phone makers.
Prachir Singh, Senior Research Analyst at Counterpoint Research, said the effect of COVID-19 on the smartphone market in India was “relatively mild until mid-March”.
“However, economical activities declined as people cut costs in expectation of a protracted amount of uncertainty and an almost complete lockdown. Almost all smartphone manufacturing has been suspended,” he noted.
Also, with the social distancing norms, factories will be running at lower capacities even following the lockdown is lifted, he said.
Consumer demand could have a larger effect on smartphone sales, as persons will focus on saving and therefore limit discretionary purchases, Singh said.
According to Counterpoint, entry-level smartphone consumers could be the worst-hit by the lockdown, and the demand for the entry-level smartphones will decline in the near-term.
“We believe demand will shift to the next portion of the year. Even if the problem stabilises by mid-year, persons may hold-off purchasing until the festive season,” Singh said.
For handset makers, a lot of work will be needed to restart operations once the lockdown is lifted.
This will range between managing existing inventory across all distributor and retail touchpoints and supporting retailers sell-through older inventory, it said.
They will also need to align their channel and sales strategies to drive sales in non-affected areas following the lockdown is lifted in phases, you start with the green zone areas.
Xiaomi led the market with 30 % share of the smartphone shipment, accompanied by vivo (17 %), Samsung (16 per cent), realme (14 %) and Oppo (12 per cent) in the first quarter.
While smartphone market registered growth, feature phone market saw a decline around 24 per cent.
Counterpoint noted that Chinese brands are gaining momentum in the feature phone market, reaching a combined 33 % share in the category, up from 17 % in the year-ago period.
Itel led the category with 22 % share of shipment, followed by Lava and Samsung (15 %), Nokia (13 %) and Micromax (7 per cent).
Samsung led the premium smartphone category (above Rs 30,000) surpassing OnePlus. Counterpoint said OnePlus’ growing occurrence in the ultra-premium segment (above Rs 45,000) can help it to expand within the same segment using its new 8 Pro series.
It added that Apple registered a 78 per cent year-on-year growth, driven by strong shipments of iPhone 11 and multiple discounts on platforms like Flipkart and Amazon. Apple led the ultra-premium segment with 55 % share.
