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Inflation hurts India smartphone demand

India’s smartphone shipments in the latest quarter grew only slightly year-on-year amid global inflation, while MediaTek’s chip share dropped to below 50% for the first time since 2020.

According to IDC’s preliminary market tracker, smartphone shipments in the second quarter increased by 3% annually to 34.7 million units but fell by 5% quarterly in India, where the second quarter typically has strong demand compared to the first quarter.

Among the top five vendors, Xiaomi’s shipments declined sharply by 28% year-on-year due to supply bottlenecks, but it still ranked first with a market share of 20.4%. Realme, Vivo, Samsung Electronics, and Oppo accounted for 17.5%, 16.9%, 16.3%, and 11.5, respectively.

According to IDC, UNISOC’s AP share has grown since the fourth quarter of 2020, reaching 17% in the latest quarter, with Qualcomm- and Samsung-based smartphone shipments and share seeing growth. MediaTek’s share dropped to below 50%, which has not been seen since 2020.

Due to more sufficient supplies of 5G smartphones than 4G handsets, the ASP for the second quarter increased 15% year-on-year to US$213. Besides, smartphones of more than US$500 saw shipment growth of 83%, with Apple accounting for 53% of the segment.

Meanwhile, the Indian regulators have recently heightened their scrutiny against China-based smartphone vendors. Xiaomi, Oppo, and Vivo have been accused of money laundering and custom duty evasion. Furthermore, Bloomberg and The Economic Times, citing unnamed sources respectively, reported that India is seeking ways to restrict China-based smartphone companies in the sub-INR12,000 (US$150) segment.

India just completed the 5G spectrum auction in early August, and the 5G service is expected to launch in a few cities in October. The Economic Times quoted an Ookla’s report that 89% of Indian smartphone users are willing to upgrade to 5G, of which 48% said they would upgrade as soon as 5G becomes available in their living areas. Among Ookla’s respondents, about half already owned a 5G smartphone.

India’s smartphone shipments (mln units)

Vendor

2Q21

2Q22

Xiaomi

9.8

7.1

Realme

4.9

6.1

Vivo

5.0

5.9

Samsung

5.5

5.7

Oppo

3.9

4.0

Others

4.6

6.1

DigiTimes

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