According to the latest India Mobile Handset Market Review Report for the second quarter of 2023, released by CyberMedia Research (CMR), India's smartphone market has witnessed a six percent year-over-year (YoY) decline in shipments. However, amidst this contraction, the 5G smartphone segment has shown remarkable resilience, marking a 45 percent YoY growth.

In a notable trend, premium smartphones priced above Rs 25,000 experienced a 36 percent YoY growth in shipments, underlining a consistent demand for high-end devices. At the same time, the 4G feature phone category saw a 108 percent YoY growth, signalling the persistence of interest in feature-rich basic phones.

The cumulative shipment of 5G-enabled smartphones crossed the milestone of 100 million units during Q2 2023. This surge in 5G adoption has pushed the market share of 5G smartphones to 47 percent, up from 31 percent during the same period in 2022.

Leading the 5G charge is Samsung, which has captured a sizeable 24 percent share of the Indian 5G smartphone market. Following closely, OnePlus holds a respectable 20 percent market share. Together, these two companies dominate almost half of the 5G smartphone segment.

Elaborating on the market dynamics, Shipra Sinha, an analyst at CyberMedia Research, said, "The minor decline in smartphone shipments can be attributed to improving macroeconomic conditions that have positively influenced consumer demand. Moreover, strategic measures by manufacturers to clear existing stock ahead of the festive season have contributed to this trend. Notably, the 5G smartphone segment continues to be a bright spot, capturing an increased market share of 47 percent."

Diverse Smartphone Landscape

In terms of overall smartphone shipments, Samsung leads the pack with an 18 percent market share, closely trailed by vivo and Xiaomi, both with 15 percent shares. This trio of companies has consistently held the top spots in the Indian smartphone landscape. realme (12 percent) and OPPO (10 percent) round up the top five.

Segment-wise, the value-for-money smartphone category, encompassing devices priced between Rs 7,000 and Rs 25,000, contributed the most substantial share at 72 percent. However, it faced a 16 percent YoY decline due to muted demand. On the flip side, the affordable smartphone category, with devices priced below Rs 7,000, marked an impressive 51 percent YoY growth.

At the upper end of the spectrum, the premium (Rs 25,000-50,000), super-premium (Rs 50,000-Rs 1,00,000), and uber-premium (Rs 1,00,000+) segments recorded robust YoY growth rates of 9 percent, 95 percent, and 133 percent, respectively. This surge in higher-priced smartphone sales contributed to a 17 percent YoY increase in the average selling price of smartphones.

Feature Phone Resilience

The feature phone market too demonstrated its own growth narrative. Overall feature phone shipments witnessed a 9 percent YoY increase, with 4G feature phones leading the charge with a remarkable 108 percent YoY growth. This segment was buoyed by contributions from models like Nokia 8000 4G, Nokia 106 4G, and itel Magic X Pro. The segment is projected to continue its growth trajectory with the introduction of devices like JioBharat.

Bright Outlook and Beyond

Looking ahead, CMR estimates that market conditions will improve in the second half of the year. The smartphone shipments for the entire year are projected to witness single-digit YoY growth. This anticipated growth is set to be bolstered by the festive season and increased consumer spending. The advent of 5G technology and foldable phones is also poised to provide a substantial impetus to the market's recovery, promising an exciting landscape for both manufacturers and consumers alike.

As Menka Kumari, an analyst at CyberMedia Research, summarised, "The smartphone market is gearing up for a strong comeback in the latter half of 2023. The combination of the festive season fervor and growing consumer expenditures, alongside the surge in 5G adoption and innovative foldable phones, will propel the market to new heights."

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