Affordable smartphones a Rs 2,800 cr opportunity in India

Tags: Gadgets
Bullish on the sub-Rs 12,000 smartphone category, international brands as well as homegrown players are geared up to flood the domestic market with more affordable devices as they try to cash in on the Rs 2,800 crore opportunity in India.

In the past week alone, brands like Motorola, Nokia and Intex launched their devices -- Moto E, Lumia 630 and Aqua i5HD -- all priced below Rs 12,000.

Interestingly, the Moto E and Lumia 630 feature the latest operating systems -- Android KitKat and Windows Phone 8.1 -- a move analysts feel is an attempt by handset makers to offer enhanced experience to woo price-conscious Indians.

"Next wave of consumer demand will come from mid-level smartphones priced below Rs 12,000. This category is expected to clock 60 million units and Rs 280 billion by value by end of FY 2014-15, with a healthy growth of about 15% over FY 2014 both in terms of both value and volume," Lava International CMD Hari Om Rai told PTI.

Research firm IDC Senior Market Analyst (Mobile Phones and Tablets) Manasi Yadav said the category is "pretty dominant".

"The category is only expected to grow further in the coming quarters as more international and local vendors launch cheaper smartphones. According to our 2013 Q4 data, this category (sub-200 USD) contributed to almost 75% in terms of shipment volumes," she added.

Gartner, another research firm, said smartphones currently account for less than 20% of the sales.

"Smartphone is high growth potential segment in Indian mobile phone market as less than 20% sales came from smartphone in 2013 compared to over 80% in markets like China. Global players like Samsung, LG, Motorola, Nokia along with local players like Micromax, Karbon, Spice, Lava are doing well in smartphone segment," Gartner Principal Research Analyst Anshul Gupta said.

Korean electronics giant Samsung, which has close to 40% share of the Indian smartphone market, believes that India is at the cusp of digital revolution as consumers switch from feature phones to smartphones at a scorching pace.

"The next 100 million connected users will demand mobile content and services in local languages provided through an enhanced user experience across a range of smart devices at an affordable total cost of ownership," Samsung India Country Head (Mobile and IT) Vineet Taneja said.

According to IDC, smartphone sales in the country grew almost three-fold to over 44 million in 2013, buoyed by a strong uptake of affordable devices made by local firms such as Micromax and Karbonn.

While Samsung led the category, Micromax had 16%, Karbonn (10%), Sony (5%) and Lava (4.7%) in the fourth quarter of 2013.

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