India’s smartphone market experienced a slight decline in shipments during Q2 2024, with a 2% year-over-year (YoY) decrease, according to Counterpoint Research. Despite this downturn, the period highlighted significant growth for some brands, particularly Nothing, which saw an impressive 567% YoY growth in H1 2024.

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Key Points

Market Overview: India’s smartphone shipments declined by 2% year-over-year (YoY) in Q2 2024.

Primary Causes: Factors contributing to the decline include a heatwave, seasonal slump, and slower demand from Q1 2024.

Xiaomi’s Performance: Xiaomi reclaimed the top position with a 23% YoY growth in shipments due to a streamlined product portfolio and enhanced marketing strategies.

Nothing’s Growth: Nothing was the fastest-growing brand in H1 2024, with a 567% YoY increase, driven by new models like the Phone (2a) and CMF Phone 1, as well as expanding service centers and retail locations.

Motorola’s Success: Motorola saw an 88% YoY growth due to its budget-friendly models and focus on CMF design.

POCO’s Segment Growth: POCO achieved a 318% YoY growth in the INR 10,000-INR 15,000 segment, driven by its M-series 5G models.

realme’s Stability: realme experienced a 2% YoT growth by expanding its portfolio with new P-series models and reintroducing the GT series.

5G Adoption: 5G smartphone shipments reached a record 77% market share in Q2 2024, driven by decreasing average selling prices (ASPs) and the introduction of more affordable models.

Chipset Market Leaders: MediaTek led the Indian smartphone chipset market with a 54% share, while Qualcomm dominated the premium segment with a 33% share.

Premium Segment Growth: The INR 20,000 to 30,000 ($240-$360) and above INR 45,000 ($540) price bands saw the fastest growth rates at 25% and 24% YoY, respectively.

Samsung’s Value Leadership: Samsung maintained its lead in value terms, capturing over 25% of the market, with its ultra-premium segment growing by 99% YoY.

vivo and Apple’s Performance: vivo secured the second position in value terms, driven by its higher-priced models, while Apple ranked third but is expected to rebound due to recent price cuts across its iPhone range.

Market Value Insights: The market achieved its highest-ever Q2 value due to premiumization trends, with consumers upgrading to higher-value smartphones supported by better trade-in values and financing options, resulting in a 24% YoY growth in the ultra-premium segment (>INR 45,000)

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Market Dynamics

Factors Influencing the Decline

Counterpoint Research attributed the 2% YoY decline in smartphone shipments in Q2 2024 to multiple factors, including a severe heatwave, a seasonal slump, and slower demand following Q1 2024. These conditions led to decreased foot traffic in physical stores and a shift in consumer priorities toward cooling appliances like air conditioners and refrigerators, resulting in unsold inventory and reduced shipments.

Positive Influences

Despite these challenges, the market saw some relief towards the end of the quarter due to aggressive online summer sales, a good harvest, and promotional activities. These efforts helped OEMs clear inventory and improve market conditions by the end of Q2 2024.

Brand Performance

Xiaomi

Xiaomi reclaimed the top spot in the market with a 23% YoY growth in shipments. This success was driven by a streamlined product portfolio spanning entry-level to affordable premium segments, enhanced marketing strategies, and expanded distribution channels.

Nothing

Nothing emerged as the fastest-growing smartphone brand in H1 2024, achieving a remarkable 567% YoY growth. This growth was fueled by the launch of new models, such as the mid-range Phone (2a) and the budget-friendly CMF Phone 1. The company also expanded its presence in India, increasing its service centers from 300 to 500 and planning further expansions.

Motorola

Motorola saw an 88% YoY growth, attributed to the success of its budget-friendly models and a focus on CMF (Color, Material, Finish) design elements.

POCO

Xiaomi’s sub-brand POCO was the fastest-growing brand in the INR 10,000-INR 15,000 (~$120-$180) segment, with a 318% YoY increase driven by budget-friendly M-series 5G models.

realme

realme experienced a 2% YoY growth by expanding its portfolio with new P-series models and reintroducing the GT series.

5G Adoption

In Q2 2024, 5G smartphone shipments reached a record 77% market share. This growth was driven by decreasing average selling prices (ASPs) and the introduction of more affordable 5G models, such as Lava’s Yuva 5G.

Chipset Market

MediaTek

MediaTek led the Indian smartphone chipset market with a 54% share, dominating the mid-range and budget segments.

Qualcomm

Qualcomm maintained its leadership in the premium segment with a 33% share, driven by high-performance chipsets in flagship devices.

Price Segment Growth

The INR 20,000-INR 30,000 ($240-$360) and above INR 45,000 ($540) price bands saw the fastest growth rates at 25% and 24% YoY, respectively. This trend reflects consumers’ increasing preference for higher-value smartphones.

Brand Value Dynamics

Samsung

Samsung retained its lead in value terms, capturing over 25% of the market. The brand’s ultra-premium segment grew by 99% YoY in Q2 2024, driven by the success of the Z Fold6 series.

vivo

vivo secured the second position in value terms, propelled by the popularity of its higher-priced models like the V30 series, known for their enhanced cameras.

Apple

Apple ranked third in value terms but is expected to rebound in the next quarter due to recent price reductions across its iPhone range.

Market Value Insights

Research Analyst Shubham Singh noted that Q2 2024 saw the highest value ever for the quarter due to premiumization trends. Consumers increasingly upgraded to higher-value smartphones, supported by better trade-in values and financing options. This led to a 24% YoY growth in the ultra-premium segment (>INR 45,000).

Conclusion

India’s smartphone market faced challenges in Q2 2024, with a 2% YoY decline in shipments. However, brands like Nothing demonstrated substantial growth, driven by innovative models and strategic market expansion. As the market continues to evolve, premiumization and the increasing adoption of 5G technology are expected to shape its future dynamics, offering consumers more advanced and higher-value smartphone options.

Source @ counterpointresearch