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Foxconn plans manufacturing base in India as Apple looks forward to a better market share

12-May-2016
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Foxconn plans manufacturing base in India as Apple looks forward to a better market share

According to an IDC report published earlier this year, Apple stood second after Samsung in terms of shipment volumes and market share. In the Indian scenario, Samsung leads the smartphone market share in the country followed by Micromax and Intex (According to CMR India research).

India wasn’t always the favourite place for Apple a few years ago. The iPhone 4 was rolled out in June 2011 in the U.S but came to India only 11 months later. With time Apple realised the potential that India holds as a market place for smartphones. It recently launched the iPhone SE just two weeks after its release in the U.S.

To underline Apple’s growing interest in India, latest reports suggest that Taiwanese contract manufacturer Foxconn is building a manufacturing facility in Maharashtra that will produce Apple phones in India.

Apple’s plans to sell refurbished phones in India were squashed by the government earlier this year, denting their hopes to build on their slow growing popularity among Indian consumers. However, Apple Inc. plans to launch its own brand stores across India to increase its market reach.

A research conducted by Canalys states that Apple is the second fastest growing vendor in the top 10 list for India, it stood at the eighth spot while Samsung was losing ground in the country by losing its market share by almost 36 percent compared to Q1 2015.

Graph of Market shares of overall mobile handset market and smartphone segment for Q1 2016

Source: CMR’s India Monthly Mobile Handset Market Review, 2016

“Apple is outperforming the overall market in India, and still has great growth potential,” said Canalys Mobility Analyst, Wilmer Ang.

With global revenues falling, India currently seems to be the silver lining for Apple. When Apple released their second quarter results, India was one of the few countries that gave them the hope of growth. In India, the iPhone sales were reportedly up by 56 percent from a year ago. Globally, Apple reported a loss in revenue from $58 billion in the similar quarter in 2015 to $50.6 billion in 2016. The gross margin was 34.9 percent compared to 40.8 percent for the same period.

With its plan to set-up manufacturing base in India, Apple aims to build on its favourable sales story and increase its consumer base across the length and breadth of the country.

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