India races ahead of US to become 2nd largest smartphone market

New Delhi: India smartphone market grew 23% in the first quarter of 2016, surpassing the US to become the second largest country in terms of users, even as sales remained flat globally, research firm Counterpoint said on Friday.

“India which surpassed the USA to become the second largest smartphone market in terms of users has continued to register strong demand for smartphone,” Counterpoint Research, Research Director Peter Richardson said.

There is a massive opportunity for every player in the mobile value chain when the second largest market by volume is still under-penetrated and growing while the rest of the world smartphone demand has waned, he added.

“India is the next China…more than a billion smartphones will be sold in India over the next five years. This will drive the number of smartphone users from a quarter of a billion to more than half a billion in the same time period,” he said.

Furthermore, the advent of advanced 4G LTE network infrastructure will also be a key catalyst in the country’s smartphone adoption in coming years, it said.

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Global smartphone shipments remained flat at 344 million units in January-March, impacted by weaker demand in China and Brazil as well as parts of Europe, as per Counterpoint.

It added that this is the first time since the launch of smartphones that the segment globally has seen no growth.

Samsung led the India smartphone tally with 29% share. Interestingly, Reliance Jio, which forayed into the market this quarter itself with brand ‘Lyf’, cornered 7% share.

“We estimate, this quarter strong shipment was more of channel filling, the actual sell-through will happen in Q2 2016 as the operator starts full-fledged marketing and promotional activity,” the report said.

Lyf also became the second largest LTE phone supplier surpassing Micromax and Lenovo during January-March 2016.

Others in the list included Micromax (17%), Intex (10%) and Lenovo (8%) and Karbonn (5%). Apple recorded a stellar 62% growth in the first quarter from the year-ago period, though on a lower base, thus registering back-to-back sequential growth in spite of negative growth results globally for iPhones.

In terms of overall mobile phone sales (including feature phones), Samsung led the segment with 25% share, followed by Micromax (14%), Intex (11%), Lava (9%) and Karbonn (5%).

“The demand for LTE smartphones remained strong as two out of three smartphone shipped was LTE capable,” Counterpoint Senior Analyst Tarun Pathak said.