India’s smartphone industry is set to see a 15-20% fall in the number of launches during the festive season, owing to shortage of components and delays in shipments. In fact, market trackers say the supply crunch has forced some brands to relaunch older models with new chipsets to meet strong demand during this make-or-break period.
“We believe that the India smartphone market will witness fewer launches this festive season (September-November),” said Prachir Singh, senior research analyst at Counterpoint Research. “According to our latest estimates, 2021 festive season will see 55-60 new launches, which is 15-20% lower than last year.”
Techarc‘s founder Faisal Kawoosa added that if one excludes variants, then 35 models will be launched in the run up to Diwali, compared with 40-45 in 2020.
Counterpoint Research also highlighted that to maintain a “stable supply”, some brands are now relaunching existing models with different chipsets.
“Samsung has re-launched Galaxy A12 with an Exynos chipset. We believe this trend may continue as brands will want to maintain high supply to meet with the increased consumer demand during the festive season,” said Singh.
The research analyst added that other such relaunches include Realme C11 2021, which was earlier Realme C11.
Samsung and realme did not respond to ET’s queries.
The supply side challenges have already forced smartphone market tracking firms to start cutting their 2021 shipment estimates by 5-10% for the second time this year, with the import curbs at airports and ports in China adding to the woes of the brands already plagued by the continuing acute shortage of chipsets.
Prabhu Ram, head-Industry Intelligence Group at CMR, estimates that there should be 50 plus launches this Diwali, but numbers are “fluid given current dynamics”.
CMR’s data shows that there were 54 launches from September-November in 2019 (pre-Covid) and 50 launches in 2020 during the festival period.
The chipset shortage has also forced Jio Platforms to delay the launch of 4G smartphone—Jio Phone Next—from September 10 to around Diwali.And although handset makers are trying to come up with limited geography launches and flying in the components, time is running out.
Diwali sales form the most crucial period for both online and offline channels since bulk of mobile purchases—around a third—happen during this period. In its latest report, Techarc said that smartphones will continue to contribute significantly to the sales of connected devices in both value and volume this year, with growth projected to be 12-15% volume wise.
While offline and online channels are wooing customers with different incentives, analysts expect tier II and III to be the main growth propellers.
Techarc expects the basic segment of smartphones (Rs 6,000-12,000) to contribute to the range of 45-50% of total smartphone sales for the year.In the metros and major cities/towns, consumers looking for upgrades and replacement buys will be the main contributors in mid-segment (Rs 12,001-25,000) purchases.