India’s smartphone shipments to see a decline due to Covid-19

    The second wave of Coronavirus has wreaked havoc in the country. The authorities are trying various ways to flatten the curve and lockdowns is one of the ways that has proved to be highly effective in breaking the chain. However, this also means that businesses including the smartphone industry are also getting impacted.

    This second wave has not only forced brands to revise their launch plans but has caused supply chain disruptions and component shortages. As a result, the agencies that track the smartphone shipments have cut down their estimates and have hinted at either flat or just 1% year on year growth.

    Before the deadly second wave, the market was expected to grow at 16%, however, statewide lockdowns have forced the retailers to close their shops and organized retail outlets are left with no other option than to curtail their operations.

    During this unprecedented situation where survival is key and people are struggling to arrange medication, oxygen and hospital beds, purchasing smartphones is not even in the wildest dreams of many. Hence a sharp dip in the numbers is expected.

    According to IDC’s quarterly Mobile Phone tracker, India’s smartphone market declined by 14 per cent during the January to March quarter compared to the previous quarter sequentially. Going by an ET report, “Research firm Strategy Analytics, which had previously estimated 2021 to record 170 million shipments, has lowered it by 10%, roughly the same as 2020. Similarly, TechArc has pegged the 2021 estimates at 150 million, the same as its numbers for 2020.

    Rebound looks difficult

    When you look at the current lockdown situation, it’s mostly partial across the country. States have imposed their version of lockdowns that isn’t as rigid as the one that we endured last year. In many states, factories are allowed to remain operational while the major restrictions are around logistics and transportations, which means that once the situation starts subsiding, catering to the demand may not be an issue.

    According to IDC, a rebound in consumer sentiments in the second half of 2021, resulting in a single-digit growth annually is expected. Also, with remote work and e-learning continuing to gain permanence the demand for computing devices, tablets, and smartphones may be a major factor that can drive growth.

    However, supply constraints and probable price hikes may be the first roadblock in the revival of the demand. Also, with the news around the third wave incoming, the spending on smartphone purchase might not be the primary focus and users may want to save for health and medication expenses.

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