India smartphone market to grow 10% in 2023 after a dip this year: Report

Analysts attributed the decline in shipments in 2022 to inflationary pressure, component shortage, and the Russia-Ukraine war, while the growth in 2023 will be driven by upgrades to 5G devices.

India has over 600 million smartphone users. According to International Data Corporation (IDC), India has shipped 67 million 5G smartphones between the first quarter of 2020 and the third quarter of 2022. By the end of this year, the total 5G smartphone shipment is expected to reach 80 million.

In 2022, the demand in the budget and mid-segment remained low, impacting overall shipments. However, the premium segment (above ₹30,000) continued to grow, as per Counterpoint.

The resurgence of covid-19 cases in China this week has revived some of the supply-related concerns of OEMs for the first quarter of 2023. However, it may not have a long-term impact on shipments.

“Despite the dip in 2022, India’s smartphone market has been resilient and performed better than many other regions,” said Ankit Malhotra, research analyst at Counterpoint.

Malhotra pointed out that the market will grow in 2023 due to the large base of feature phone users looking to upgrade to smartphones, local smartphone production, the rollout of 5G services in India, and the emergence of newer use cases.

Users who held onto their smartphones this year may also upgrade next year due to a reduction in inflationary pressure, he added.

According to a TechARC report, also released Friday, 47 smartphone models were launched in the September quarter, out of which 31 supported 5G.

Around 35% of the 5G devices launched during the quarter were in the mid segment ( ₹12,000-25,000), whereas in the budget segment ( ₹6,000-12,000), only one smartphone was 5G ready.

Most OEMs have struggled to roll out 5G smartphones in the budget segment due to high component prices, as per experts. Jio announced in August that it is working with Google on a 5G-ready budget smartphone.

Further, analysts at Counterpoint said that the government tenders for smartphones are also expected to drive demand in 2023. For instance, the government of Rajasthan has floated a tender to acquire smartphones that will be distributed among women.