According to a latest joint study by ASSOCHAM-KPMG, India is expected to have a total of 180 million smart phones by 2019. This will contribute to 13.5 percent of the total global smart phone market as compared to 7.6 percent at present.
The affordable smartphones category (3000-10000) has helped boost sales in India and more people are using these devices with an increased option of cheaper data services provided by cellular operators and OTP players.
Out of the total handset sale of 30 crore in FY15, 11.40 crore were smartphones and is projected to grow to above 50 percent by 2020.
The urban-rural divide has continued to stay in the country and smartphones feel the pinch too. With more players like Facebook trying to reach out to smaller pockets of the country with services like Wi-Fi Express, it is only evident that smartphone manufacturers would turn their eyes toward this region.
As of February 2016, teledensity in urban areas was 153.93 vis-àvis 50.76 for rural India. Rural mobile phone subscriptions are already on the rise. Nearly 38 per cent of rural population used mobile phones as of May 2015, up from 22 per cent in 2010.
India manufactured 11 crore mobile phones worth INR 54,000 crore in FY16, showing a year-on-year growth of 83 per cent and 186 per cent, in volume and value terms, respectively. With the ability to provide feature rich yet affordable handsets, domestic manufacturers’ share of the handset market is slated to grow further.
According to the ASSOCHAM-KPMG study, the market for mobile handsets in India is growing at a fast rate. It has grown at a CAGR of nearly 14 percent from 2011 to 2015. It also contributed nearly 7.6 percent to the global smartphone market.
Increase in smartphone sales has helped shape the e-commerce industry in India in the last two years. The study says mobile transactions accounted for 41 per cent of total e-commerce sales in 2014 and that “developing a mobile (sometimes mobile only) strategy has been an important agenda for many of the leading e-commerce players in the country over the last two to three years.”
ASSOCHAM also added “India’s mobile handset industry is a key enabler for the government’s ‘Digital India’ initiative, launched in July 2015 to work together on a common agenda to transform the country into a digitally powered society and economy. Several international device vendors have set up manufacturing facilities in India, supporting the government’s ‘Make in India’ initiative aimed at boosting local manufacturing.”