All smartphone companies have shut down their manufacturing plants to support the government order on lockdown. The companies have also postponed their launches after Prime Minister Narendra Modi announced the curfew, despite knowing that this lockdown will affect their revenue for this year.
Now, a new report by Cybermedia Research (CMR), states that this lockdown will affect smartphone production in India. The report says that the production is likely to fall by 38-40 percent in the first half of 2020.
“Our current India smartphone market assessment points to a bleak picture, with some promise in H2 2020. We anticipate a significant drop of around 20 percent year-on-year (YoY) in smartphone shipments in Q1 2020. There will be a full-blown impact in Q2 2020, with a sharp decline of around 28 percent YoY. That said, we are keeping a close tab, and will continue to update our guidance,” said Prabhu Ram, Head-Industry Intelligence Group, CMR.
The CMR also believes that offline retailers will have a major impact, as sales are down by 50 to 60 percent. Moreover, the firm believes that the sale will remain flat for the rest of the year, as there is will be uncertainty on the economic front.
“If one were to go by China’s experience, the online channels made-up for the deficit, incurred in offline channels. However, in the Indian context, with the initial 21-day lockdown in force, we are now looking at a rather uncertain future. That said, we believe online has the potential to pick-up in terms of sales during mid- to late- Q2 and beyond,” said Amit Sharma, Manager Research, CMR.
Meanwhile, ICEA chairman Pankaj Mahindroo said that the industry will lose around Rs. 15,000 crore in 21 days. Smartphone makers such as Oppo, Vivo, Apple, Samsung, Realme, and Xiaomi have shut down their operations in their plants.
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