Mobile phones sales: It’s time to bounce back!

Indians procured 150 million mobile phones last year, despite this being a 2 percent dip compared to the sales in 2019, according to International Data Corporation (IDC), a global market intelligence firm. Analysts and agencies watching numbers, however, are optimistic of a stronger performance this year, with the first three months of the year expected to set up a strong trend.

Different sets of data are hinting at a bounce-back in the mobile phones segment this year. The Oct-Dec quarter showed strong signs. GfK, a global intelligence platform, through its POS data, Oct-Dec, observed 17 percent growth for smartphones in terms of value for online and offline sales compared to the previous year’s quarter. In terms of units sold, this translates into 8% growth.

IDC figures for smartphone shipments, for the said duration, are 45 million devices, a year-on-year growth of 21 percent, though the whole year’s shipments remained below the pre-pandemic level. On a broader horizon, India’s smartphone market growth in terms of annual shipment, stood around 14 percent in 2017, around 8 percent in 2019, before taking a dip last year. IDC expects the market to bounce back with single high-digit growth, 9 to 10 percent, in 2021.

“The rebound of the smartphone market in the latter half of 2020 underscores the importance of devices in our day-to-day lives. In 2021, IDC expects the smartphone market to grow in high single-digit YoY, driven majorly by upgrading consumers, in the mid-range segment and affordable 5G offerings (around $250). Also, revamped offline channel play is anticipated, to bring back growth in the very important brick and mortar counters for long-term sustainability,” says Navkendar Singh, research director, client devices & IPDS, IDC India.

The year 2020 also witnessed a keen focus on 5G smartphones. Industry analysts expect the launch of more 5G devices in the range considered affordable by the Indian buyers. ” With devices go the first strategy, 5G smartphone shipments had crossed 3 million in 2020.  IDC anticipates more 5G devices at (sub-US$ 250) multiple price points backed by aggressive promotions, through 2021, as spectrum will be made available by end 2021 or early 2022,” says Upasana Joshi, associate research manager, client devices, IDC India.

With optimism high for the year ahead, the first three months of the year – January to March – is likely to register a year-on-year growth in the range of 11 to 13 percent (with shipments in the range of 34-37 million smartphones), says Tarun Pathak, associate director, Counter Research, global industry analysis firm. In the first three months, March is expected to be the strongest, with shipment projections to be over 12 million sets for Jan. “The year, 2021, will be strong. Some demand, from the past, has got carried forward. There are late adopters and some discounts are still on offer. What’s a concern is the shortage of components. This may be a cause of worry in the short run, three-four months. However, there are new launches this year with a focus on 5G. This can be an uptick story,” said Pathak.

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