{"id":122875,"date":"2021-04-28T08:43:59","date_gmt":"2021-04-28T08:43:59","guid":{"rendered":"https:\/\/precoinnews.com\/?p=122875"},"modified":"2021-04-28T08:43:59","modified_gmt":"2021-04-28T08:43:59","slug":"2nd-covid-wave-may-erase-gains-in-smartphone-market","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/business\/2nd-covid-wave-may-erase-gains-in-smartphone-market\/","title":{"rendered":"2nd Covid wave may erase gains in smartphone market"},"content":{"rendered":"
While the record shipments reflects the prevailing mood at the time, the exponential rise in Covid cases in the country has turned the tide since.<\/strong><\/p>\n <\/strong><\/p>\n The smartphone market in India has recorded an impressive 23 per cent year-on-year growth in the January-March quarter in anticipation of a steady recovery in coming months.<\/p>\n But the resurging Covid wave may spoil the market dynamics in April-June quarter, just like it did last time.<\/p>\n After shipping a record number of smartphones in July-September and October-December periods, handset companies were on a ride.<\/p>\n With consumers performing all crucial tasks like banking to studying online, demand for additional screens jumped manifold since the lockdown in 2020 – taking smartphone demand at a new high.<\/p>\n Recovery in economic activities and declining Covid cases further raised market sentiments in 2021 – pushing brands towards procuring ever higher numbers of devices.<\/p>\n At 38 million units, this time the shipment is highest ever for the January-March period, analyst firm Counterpoint Research noted in its latest report.<\/p>\n “Continuing with its stellar run, India’s smartphone market registered a third consecutive quarter of record shipments in the first quarter of 2021, riding on pent-up demand. consumer confidence also increased due to the beginning of a vaccination drive in the country,” said Prachi Singh, analyst at Counterpoint.<\/p>\n While the record shipments reflects the prevailing mood at the time, the exponential rise in Covid cases in the country has turned the tide since.<\/p>\n Redisposition of lockdowns and restrictions at major metros and key districts across the country has brought the offline business at its knees.<\/p>\n According to All India Mobile Retailers Association, lockdown in Maharashtra alone has left its 15,000 retailers high and dry.<\/p>\n Another industry body Retailers Association of India has pegged the overall all loss in business of non-essential goods in India at 45 per cent in April.<\/p>\n According to Singh from Counterpoint, the superior growth in the March quarter might not sustain in the coming days.<\/p>\n “These (March quarter) numbers should be taken with caution as a second and more virulent wave of Covid-19 is currently on in the country.<\/p>\n “That is likely to impact the coming quarters.<\/p>\n “The consumer demand will take a hit due to the ongoing Covid-19 wave and subsequent lockdowns,” he said.<\/p>\n Various estimates suggest, handset makers could be hit by a loss of business amounting to 5-10 million smartphones in the current quarter.<\/p>\n With average selling price of smartphones hovering around Rs 11,500, their total loss may range between Rs 5,700 and Rs 11,500 crore.<\/p>\n Last year’s numbers show, the impact of lockdown measures could be devastating on the handset market. In April-June quarter, the market had shrunk by 51 percent to 18 million units.<\/p>\n Ever since, Chinese companies have been bearing the impact of the pandemic – with all four leading players losing share in the local market.<\/p>\n After two years of subdued sales, in January IDC had predicted the local market to grow by up to 21 per cent in 2021.<\/p>\n However, market experts are now weary of the fact that like last time the impact of lockdowns do not drag the numbers for the entire year.<\/p>\n In 2020, the smartphone market declined for the first time, by 4 per cent, as loss from the June quarter could not be compensated for.<\/p>\n Image used for representation purpose only.<\/strong><\/p>\n Photograph: Truth Leem\/Reuters<\/strong><\/p>\n