New Delhi: Smartphone shipments<\/a> in India contracted further in May despite improvement in the component shortage situation with brands struggling to clear inventories both online and offline due to a slump in demand, market tracker Counterpoint Research<\/a> has said.
Smartphone shipments declined by 9.2% month-on-month in May with brands stuck with weeks of inventory in their warehouses as even online channels reduced intake of inventory, according to Counterpoint Research that tracks monthly smartphone shipments by brands to various channels.
“We are seeing a dip for all the brands due to inflationary pressures, and low disposable incomes. However, some brands have piled up a lot of inventory by the end of Q2,” said Prachir Singh, senior analyst at Counterpoint Research.
A market analyst who wished not to be named said the inventory of a model of one of the fast-growing Chinese brands has been stuck for over 12 weeks.
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While Xiaomi<\/a> was still leading the market in May, the top five saw a change. Vivo caught up with Samsung<\/a> to the second spot, with 18% share each, as per Counterpoint Research data. Vivo’s shipments grew from 15% in April while Samsung’s fell from 20%.
Xiaomi’s market share improved to 22% in May from 21% in April. The Chinese firm has been under investigation by the Enforcement Directorate for alleged Foreign Exchange Management Act<\/a> (FEMA) violations.
Shares of number four and five Realme<\/a> and Oppo<\/a> slipped to 15% and 10%, respectively, in May from 17% and 11% in April.
Navkendar Singh, research director at market researcher IDC, said the company does not expect a sharp jump in sales this fiscal. “Supplies are getting better, but 4G chipset supply is still an issue, which is why demand is an issue, and we are looking at mid-single digit growth. We, as IDC, are not very bullish frankly, for India,” he said.
“When we speak to the brands and ecosystem players, they more or less agree with us, but some are still feeling optimistic and certainly don’t agree with some of the numbers out there,” Singh added.
Brands hope that festive-season sales, due to start from August, will give some momentum back to the market. “The year has not been great, and the demand is not picking up naturally even after so many launches, so the brands are expected to start with their pre-festive sales early,” Singh said.
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