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Analysts downgrade India’s 5G smartphone sales forecast

Industry analysts are lowering their estimates of smartphone sales growth in India even as telecom operators remain enthusiastic about rolling out 5G networks in the country.

While data from International Data Corporation (IDC) showed that companies have shipped 67 million 5G smartphones in India so far, analysts said a total of 80 million 5G smartphones are expected to be shipped by the end of this year, down from 85-90. Predicted a million smartphones earlier.

They attributed this to several factors such as high inflation, lower demand for smartphones, higher prices of 5G devices compared to 4G, and also that consumers are beginning to realize that 5G does not provide immediate and noticeable improvements in their smartphone experiences.

“The target may fall short. By the end of the year, the share of 5G smartphone shipments is expected to reach 80 million. This is primarily due to the shortage of smartphones that Less than 15k.”Brands have also failed to offer 5G smartphones at lower prices due to supply chain costs. Still high due to inflation.” Although the average selling price (ASP) of smartphones fell from $509 in Q1 2020 to $393 in Q3 2022, it is still high in A market like India where the average selling price is $226.

“For widespread market adoption, ASP needs to be closer to $200. There is still a lot of time until 5G phones reach that level. It could happen sometime after next year,” said Tarun Pathak, research director at Counterpoint Research. On average, he said, 15 million 5G smartphones are shipped each quarter. “It could take 6 to 7 months for shipments to reach 100 million,” he said.

Faisal Qawsa, founder and chief analyst at TechARC, agreed. “Circumstances are not that great globally. The supply chain has not become so efficient that it will allow OEMs to save. OEMs also know that it is better to be in a very profitable area,” Kawusa said.

According to a report by techARC in September, the real 5G years are yet to come in India which will see companies introducing 5G smartphones in India. R10,000 – 20,000.

Sure enough, analysts also said that smartphone demand in India tends to decline after the festive season every year. In the third quarter, total smartphone sales decreased by 10% compared to last year. Another decline in sales will affect estimated 5G shipments for this year.

abhijit.ahaskar@livemint.com

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