India's smartphone market experiences steepest quarterly decline, at 19%

The overall smartphone shipments, fell 19-20% to 31 million in January-March, which is the highest-ever decline in the first quarter

According to the most recent analysis from Counterpoint's Market Monitor service, smartphone shipments to India decreased 19% YoY in Q1 2023 (January-March) to reach over 31 million units. Additionally to being the third consecutive quarter of decrease, this was the greatest Q1 decline ever experienced by India's smartphone market.

Shipments of mobile phones under Rs 30,000 each saw a steep fall, while those in the premium and ultra premium price range increased by 60–66%.decline.

The report further noted that with a 20% market share in Q1 2023, Samsung continued to hold the top spot in the Indian smartphone market for the second consecutive quarter. With a 24% market share, it continued to be the top brand for 5G shipments. With 50% of the shipments in the offline market, the new 5G-capable A series did well. Samsung's ultra-premium sector (>INR 45,000, $550) increased 247% YoY in Q1 2023, because to the S23 series' strong launch and financing possibilities.

In Q1 2023, OnePlus experienced the fastest YoY increase at 72%, led by high demand for the OnePlus Nord CE 2 Lite and recently released OnePlus 11 series. The most popular model in Q1 2023 was the Nord CE 2 Lite 5G from OnePlus. With a 30% share, it took second place in the premium category (INR 30,000–INR 45,000 or $370–$550). The company has also been actively boosting its offline presence by creating experience stores in several cities.

Despite the fact that 5G coverage is still spotty in most of the country, according to the research organisation, the market share of 4G phones has been declining from November 2022 to April 2023.Purchases of 4G smartphones were at 64% of all smartphone purchases in November of last year, while sales of 5G smartphones were at 36%. According to Counterpoint, in April 2023, the sales share of 4G smartphones dropped to 50%, 5G smartphones’ contribution to total smartphone shipments reached a record of 43%.

The introduction of 5G technology does have an impact on the market for 4G handsets, but the extent of this impact may vary. With the rollout of 5G networks, there is an increased focus on promoting and adopting 5G-capable devices. As a result, many consumers are inclined to purchase smartphones that support the latest generation of wireless technology.

By March 2025, 300 million customers, or over a third of India's wireless data consumers, are anticipated to be using 5G services, up from an anticipated 20 to 25 million by that month. The remaining two thirds would keep using 4G according to a CRISIL report.

Naveen Vaidyanathan, Director, CRISIL Ratingsalso mentions that, “Currently, about 30-35% of the ~150-170 million smartphones shipped in India annually are 5G enabled.

Overall, while the rise of 5G technology may create some challenges for retailers selling 4G handsets, the demand for 4G devices is expected to persist for a certain period, therefore this decline in India's smartphone market can be said to have been caused by sluggish demand, huge inventory levels carried over from 2022, rising consumer preference for used phones, and negative channel assessments of the industry as mentioned in the report.