Covid curbs: Smartphone sales set for a bigger hit | Economic Times

Smartphone sales are set to take a sharper hit in the coming weeks with restrictions being announced in Delhi as well, adding to Mumbai, the top two metros accounting for 20% of India’s overall smartphone market. But market trackers say the bigger fear is of a lockdown in Noida, which would lead to a far bigger negative impact on the industry, as the region accounts for 60% of the smartphone production in India.For now, the lockdowns in Mumbai and Delhi would hurt the premium segment of devices more, a segment that has been the fastest growing category—between 70% and 100%—for the past three quarters. “We will fall short of 50% of our targets for April, and this is worrisome at a time when Apple products are immensely in demand,” a manager at an Apple store in South Delhi said. “Even in a non-festive month like April, we were selling 4-5 iPhones on weekdays and 10-11 on weekends on average.”Market tracker firms are wary of the economic impact on customers, which may not bring back demand of smartphones for another three-four months, or until the festive season, even if restrictions ease out. Based on preliminary analysis of restrictions across India, Counterpoint has lowered its shipment forecast for the April-June quarter by 5 million, to 32-34 million shipments.“We had already factored in loss of shipments in Covid hotspots as of now, but the biggest setback would be a lockdown in Noida,” said Tarun Pathak, director of research at Counterpoint Research. “With global supply chain hurdles lurking upon brands, a production shutdown in Noida could seriously impact the likes of Oppo, Vivo, Realme, OnePlus, Samsung and Lava etc,” he said.Offline smartphone retailers expect another round of job losses, inventory pile up and increased debt in 2021. There are close to 10,000 mom-and-pop mobile stores, besides 100-200 multi-brand retail outlets in Delhi.“Delhi is one among the biggest cities for the smartphone market. The impact will lurk beyond the six-day lockdown in offline stores due to piling inventory, increased operational debt,” said Arvinder Khurana, national president, All-India Mobile Retailers Association.