Mobile Phones in India: Marketline Industry Profile

A Progressive Digital Media business
MarketLine Industry Profile
Mobile Phones in
India
May 2019
Reference Code: 0102-0152
Publication Date: May 2019
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MARKETLINE. THIS PROFILE IS A LICENSED PRODUCT AND IS NOT TO BE PHOTOCOPIED
India - Mobile Phones 0102 - 0152 - 2018
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EXECUTIVE SUMMARY
Market value
The Indian mobile phones market shrank by 15.2% in 2018 to reach a value of $24.2 billion.
Market value forecast

In 2023, the Indian mobile phones market is forecast to have a value of $29.7 billion, an increase of 22.7% since 2018.
Market volume
The Indian mobile phones market grew by 34.1% in 2018 to reach a volume of 1,211.8 Average MOU.
Market volume forecast

In 2023, the Indian mobile phones market is forecast to have a volume of 1,031.5 Average MOU, a decrease of 14.9%
since 2018.
Geography segmentation
India accounts for 7.1% of the Asia-Pacific mobile phones market value.
Market rivalry
The Indian mobile phones market is dominated by a small number of large-sized companies, such as Micromax
Informatics, Lenovo, Xiaomi and BBK. Rivalry is increased due to the limited number of competitors and the high
penetration of mobile phone devices, which intensifies R&D expenses and price competition.

TABLE OF CONTENTS
Executive Summary......................................................................................................................................................... 2
Market value ................................................................................................................................................................ 2
Market value forecast .................................................................................................................................................. 2
Market volume ............................................................................................................................................................. 2
Market volume forecast ............................................................................................................................................... 2
Geography segmentation ............................................................................................................................................ 2
Market rivalry ............................................................................................................................................................... 2
Market Overview.............................................................................................................................................................. 7
Market definition .......................................................................................................................................................... 7
Market analysis............................................................................................................................................................ 7
Market Data ..................................................................................................................................................................... 9
Market value ................................................................................................................................................................ 9
Market volume ........................................................................................................................................................... 10
Market Segmentation .................................................................................................................................................... 11
Geography segmentation .......................................................................................................................................... 11
Market Outlook .............................................................................................................................................................. 12
Market value forecast ................................................................................................................................................ 12
Market volume forecast ............................................................................................................................................. 13
Five Forces Analysis ..................................................................................................................................................... 14
Summary ................................................................................................................................................................... 14
Buyer power .............................................................................................................................................................. 15
Supplier power........................................................................................................................................................... 16
New entrants ............................................................................................................................................................. 18
Threat of substitutes .................................................................................................................................................. 20
Degree of rivalry ........................................................................................................................................................ 21
Leading Companies....................................................................................................................................................... 23
BBK Electronics Corp Ltd .......................................................................................................................................... 23
Micromax Informatics Ltd .......................................................................................................................................... 24
Samsung Electronics Co., Ltd. .................................................................................................................................. 25
Xiaomi Inc .................................................................................................................................................................. 28
Macroeconomic Indicators............................................................................................................................................. 29

Country data .............................................................................................................................................................. 29
Methodology .................................................................................................................................................................. 31
Industry associations ................................................................................................................................................. 32
Related MarketLine research .................................................................................................................................... 32
Appendix........................................................................................................................................................................ 33
About MarketLine ...................................................................................................................................................... 33

LIST OF TABLES
Table 1: India mobile phones market value: $ billion, 2014–18.......................................................................................9
Table 2: India mobile phones market volume: Average MOU, 2014–18 .......................................................................10
Table 3: India mobile phones market geography segmentation: $ billion, 2018............................................................11
Table 4: India mobile phones market value forecast: $ billion, 2018–23.......................................................................12
Table 5: India mobile phones market volume forecast: Average MOU, 2018–23 .........................................................13
Table 6: BBK Electronics Corp Ltd: key facts................................................................................................................23
Table 7: Micromax Informatics Ltd: key facts ................................................................................................................24
Table 8: Samsung Electronics Co., Ltd.: key facts ........................................................................................................25
Table 9: Samsung Electronics Co., Ltd.: key financials ($) ...........................................................................................26
Table 10: Samsung Electronics Co., Ltd.: key financials (KRW)...................................................................................26
Table 11: Samsung Electronics Co., Ltd.: key financial ratios.......................................................................................26
Table 12: Xiaomi Inc: key facts...................................................................................................................................... 28
Table 13: India size of population (million), 2014–18 ....................................................................................................29
Table 14: India gdp (constant 2005 prices, $ billion), 2014–18 .....................................................................................29
Table 15: India gdp (current prices, $ billion), 2014–18 ................................................................................................29
Table 16: India inflation, 2014–18 ................................................................................................................................. 30
Table 17: India consumer price index (absolute), 2014–18...........................................................................................30
Table 18: India exchange rate, 2014–18 .......................................................................................................................30

LIST OF FIGURES
Figure 1: India mobile phones market value: $ billion, 2014–18 .....................................................................................9
Figure 2: India mobile phones market volume: Average MOU, 2014–18......................................................................10
Figure 3: India mobile phones market geography segmentation: % share, by value, 2018 ..........................................11
Figure 4: India mobile phones market value forecast: $ billion, 2018–23......................................................................12
Figure 5: India mobile phones market volume forecast: Average MOU, 2018–23 ........................................................13
Figure 6: Forces driving competition in the mobile phones market in India, 2018.........................................................14
Figure 7: Drivers of buyer power in the mobile phones market in India, 2018 ..............................................................15
Figure 8: Drivers of supplier power in the mobile phones market in India, 2018...........................................................16
Figure 9: Factors influencing the likelihood of new entrants in the mobile phones market in India, 2018.....................18
Figure 10: Factors influencing the threat of substitutes in the mobile phones market in India, 2018 ............................20
Figure 11: Drivers of degree of rivalry in the mobile phones market in India, 2018 ......................................................21
Figure 12: Samsung Electronics Co., Ltd.: revenues & profitability...............................................................................27
Figure 13: Samsung Electronics Co., Ltd.: assets & liabilities.......................................................................................27

MARKET OVERVIEW
Market definition
The Mobile Phones market includes mobile phone service revenues and average minutes of use (MOU). Market values
are made up of total mobile revenues containing revenues from mobile service providers and other members of the
mobile service value-chain for the provision of mobile telephony services, excluding revenues from the sale of devices.
Market volumes are made up of two segments: prepaid and postpaid, which consist of prepaid average monthly MOU
and postpaid average monthly MOU. Minutes of use are made up from the average of voice minutes used in mobile
subscriptions, including both incoming and outgoing calls, but not including M2M/IoT voice services.
All currency conversions are carried out at constant average annual 2018 exchange rates.
For the purposes of this report, the global market consists of North America, South America, Europe, Asia-Pacific, Middle
East, South Africa and Nigeria.
North America consists of Canada, Mexico, and the United States.
South America comprises Argentina, Brazil, Chile, Colombia, and Peru.
Europe comprises Austria, Belgium, the Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Italy,
Netherlands, Norway, Poland, Portugal, Russia, Spain, Sweden, Switzerland, Turkey, and the United Kingdom.
Scandinavia comprises Denmark, Finland, Norway, and Sweden.
Asia-Pacific comprises Australia, China, Hong Kong, India, Indonesia, Kazakhstan, Japan, Malaysia, New Zealand,
Pakistan, Philippines, Singapore, South Korea, Taiwan, Thailand, and Vietnam.
Middle East comprises Egypt, Israel, Saudi Arabia, and United Arab Emirates.
Market analysis
The Indian mobile phones market experienced negative growth during the historic period. Growth over the forecast
period is expected to be positive.
The mobile phones market has begun to saturate as more and more consumers already possess a mobile phone of
some kind. Competition in the market is fierce as mobile phone manufacturers try to differentiate their products from the
competition in order to increase their market share.
The Indian mobile phones market had total revenues of $24.2bn in 2018, representing a compound annual rate of
change (CARC) of -4.2% between 2014 and 2018. In comparison, the South Korean and Chinese markets grew with
compound annual growth rates (CAGRs) of 0.6% and 3.5% respectively, over the same period, to reach respective
values of $22.7bn and $159.0bn in 2018.
High levels of inflation, alongside high unemployment rates, have played greatly affected the growth of the mobile
phones market. Due to those economic indicators’, consumers tend to have less confidence in their economic power,
making them unable to consume those kinds of goods, which in developing countries could be considered a luxury good.
Consumers in developing countries tend to prefer first order goods such as clothing, food and water.
Market consumption volume increased with a CAGR of 11.2% between 2014 and 2018, to reach a total of 1,211.8
average MOU in 2018. The market's volume is expected to fall to 1,031.5 average MOU by the end of 2023, representing
a CARC of -3.2% for the 2018-2023 period.

The increase in online retailers selling the same kind of mobile phones at cheaper prices reduced the number of
consumers purchasing mobile phones from high street stores to a great extent. In addition, consumers tend to buy
second-hand or used mobile phones from online retailers as a cheap alternative, while other consumers tend to keep
their mobile phones for more than five years due to them not being that different from the newest models, decreasing
market growth overall. On the other hand, copies of popular mobile phones, which have to some extent the same
characteristics as the originals, can be found online for very cheap prices. These imitations are used by consumers who
cannot afford the originals but want to project a high social stature. Due to the fact that popular mobile phones such as
the iPhone XR or Samsung Galaxy S10+ are being used as social stature indicators because of their expensive prices,
consumers who do not have the economic power to purchase those kinds of mobile phones, but want to demonstrate a
certain level of social stature, will purchase cheap imitations of them, which undermines market growth.
Postpaid had the highest volume in the Indian mobile phones market in 2018, with a total of 647.9 average MOU,
equivalent to 53.5% of the market's overall volume. In comparison, prepaid had a volume of 563.9 average MOU in
2018, equating to 46.5% of the market total.
Postpaid was the most successful segment for the mobile phone market due to it seeming to be the “cheaper” option
according to consumers. Postpaid phones require consumers to sign a contract with a mobile network operator making
them pay a monthly sum for their mobile phones, usually up to 12 months. The monthly sum varies according to the
mobile network operator and is at least 500% cheaper than the total cost of the phone. Because most consumers are
willing to pay a smaller price for a longer period of time for a product, rather than a larger price for a shorter period of
time, it makes them feel more secure and that they got a “cheaper” deal. Prepaid was the least successful segment as it
creates the opposite feeling to postpaid mobile phones, even though prepaid mobile phones are a great deal cheaper
than postpaid ones.
The performance of the market is forecast to accelerate, with an anticipated CAGR of 4.1% for the five-year period 2018
- 2023, which is expected to drive the market to a value of $29.7bn by the end of 2023. Comparatively, the South Korean
market will increase with a CAGR of 0.4%, and the Chinese market will decline with a CARC of -0.6%, over the same
period, to reach respective values of $23.2bn and $154.5bn in 2023.
The mobile phones market is expected to grow during the forecast period. The market is positively correlated with
technology; as technological advantages occur, the mobile phone market’s growth will increase. At the moment,
Samsung, Huawei and Oppo have launched a series of new foldable smartphones, which is a ground breaker for the
market, increasing growth in the long-run. However, as more mobile phone manufactures produce highly technological
products, competition will rise, decreasing the market’s growth overall. Consumers who purchase new mobile phones
now will cause saturation in the market, as consumers are resistant to purchasing a new phone until there is a new
technological advancement. Instead, they will turn to cheaper alternatives such as second-hand mobile phones, mobile
phones imitations, or they will keep their mobile phones for a longer period of time. When the new technological
advancement occurs, growth will rise again. The market is doomed to operate in a vicious circle, highly influenced by
consumers’ behaviour and technological advantages.

MARKET DATA
Market value
The Indian mobile phones market shrank by 15.2% in 2018 to reach a value of $24.2 billion.
The compound annual rate of change of the market in the period 2014–18 was -4.2%.
Table 1: India mobile phones market value: $ billion, 2014–18
Year $ billion Rs. billion € billion % Growth

2014 28.8 1,969.4 24.4
2015 29.0 1,987.2 24.6 0.9%
2016 29.0 1,983.9 24.6 (0.2%)
2017 28.6 1,955.8 24.2 (1.4%)
2018 24.2 1,657.7 20.5 (15.2%)
CAGR: 2014–18 (4.2%)
SOURCE: MARKETLINE MARKETLINE
Figure 1: India mobile phones market value: $ billion, 2014–18

Market volume
The Indian mobile phones market grew by 34.1% in 2018 to reach a volume of 1,211.8 Average MOU.
The compound annual growth rate of the market in the period 2014–18 was 11.2%.
Table 2: India mobile phones market volume: Average MOU, 2014–18
Year Average MOU % Growth

2014 792.8
2015 785.6 (0.9%)
2016 782.1 (0.4%)
2017 903.8 15.6%
2018 1,211.8 34.1%
CAGR: 2014–18 11.2%
Figure 2: India mobile phones market volume: Average MOU, 2014–18

MARKET SEGMENTATION
Geography segmentation
India accounts for 7.1% of the Asia-Pacific mobile phones market value.
China accounts for a further 46.9% of the Asia-Pacific market.
Table 3: India mobile phones market geography segmentation: $ billion, 2018
Geography 2018 %
China 159.0 46.9
Japan 66.7 19.7
India 24.2 7.1
South Korea 22.7 6.7
Taiwan 7.2 2.1
Rest of Asia-Pacific 59.5 17.5
Total 339.3 100%
Figure 3: India mobile phones market geography segmentation: % share, by value, 2018

MARKET OUTLOOK
Market value forecast
In 2023, the Indian mobile phones market is forecast to have a value of $29.7 billion, an increase of 22.7% since 2018.
The compound annual growth rate of the market in the period 2018–23 is predicted to be 4.1%.
Table 4: India mobile phones market value forecast: $ billion, 2018–23
Year $ billion Rs. billion € billion % Growth

2018 24.2 1,657.7 20.5 (15.2%)
2019 25.0 1,708.5 21.2 3.1%
2020 26.5 1,813.2 22.5 6.1%
2021 27.2 1,862.0 23.1 2.7%
2022 28.2 1,931.5 23.9 3.7%
2023 29.7 2,029.0 25.1 5.0%
CAGR: 2018–23 4.1%
Figure 4: India mobile phones market value forecast: $ billion, 2018–23

Market volume forecast
In 2023, the Indian mobile phones market is forecast to have a volume of 1,031.5 Average MOU, a decrease of 14.9%
since 2018.
The compound annual rate of change of the market in the period 2018–23 is predicted to be -3.2%.
Table 5: India mobile phones market volume forecast: Average MOU, 2018–23
Year Average MOU % Growth

2018 1,211.8 34.1%
2019 1,012.9 (16.4%)
2020 1,027.8 1.5%
2021 1,028.9 0.1%
2022 1,028.1 (0.1%)
2023 1,031.5 0.3%
CAGR: 2018–23 (3.2%)
Figure 5: India mobile phones market volume forecast: Average MOU, 2018–23

FIVE FORCES ANALYSIS
The mobile phones market will be analyzed taking mobile phone manufacturers as players. The key buyers will be taken
as retailers and network operators, and technological manufacturers for mobile telephony as the key suppliers.
Summary
Figure 6: Forces driving competition in the mobile phones market in India, 2018
The Indian mobile phones market is dominated by a small number of large-sized companies, such as Micromax
Informatics, Lenovo, Xiaomi and BBK. Rivalry is increased due to the limited number of competitors and the high
penetration of mobile phone devices, which intensifies R&D expenses and price competition.
Buyers tend to be large, and are therefore able to negotiate favorable contracts, although their bargaining power and
profitability is limited regarding new, popular products due to price and stock competition with other buyers.
Suppliers provide technology, equipment and parts for mobile phone manufacturing. Such technology is often highly
specialized, leaving suppliers reliant on this supply agreement, particularly as some parts can be unique to a certain
manufacturer.
The rise of the smartphone allows new entrants to exploit a burgeoning position in the market, although in many
developed economies such as the US, this market is becoming highly saturated.
Considering the increasingly high penetration of smartphones, newcomers may be put off by high capital outlay, the
scale economies necessary to compete with incumbents who have excellent brand reputations, and strict regulations
regarding health and safety and the environment.

Buyer power
Figure 7: Drivers of buyer power in the mobile phones market in India, 2018
This market is made up of two categories of buyers. Firstly, there are big store retailers, such as The Mobile Store and
Univercell, which purchase handsets to sell on to end-users. These players are large in size, which increases buyer
power. However, the number of players in this market are few and end-users possess a large amount of awareness with
regards to these large players, meaning that retailers will attempt to accommodate the products of as many players as
possible, reducing their power.
The second category of buyers is mobile network operators, such as Airtel India, Vodafone and Idea Cellular, many of
whom conduct their own retail operations. In particular, the Indian market is highly competitive, as there are 11 providers
with millions of subscribers. However, their position is precarious due to the fact that the vast majority of consumers in
the Indian market are prepaid subscribers, thus operators do not have the power to leverage their clients against
manufacturers. Subsequently, network operators may not have exclusive deals with manufacturers.
Furthermore, Samsung is the only manufacturer with a significant retail store presence in this market, so its bargaining
power is enhanced against buyers. Online retailing is another distribution channel that provides some independence to
mobile manufacturers.
Switching costs in the market are relatively low, increasing buyer power. Buyers in the market, such us The Mobile Store
or Univercell, tend to have high bargaining power due to their big financial power, meaning that they are able to buy in
bulk at relatively low prices. Retailers and network operators of this kind sign short-term contracts with market players
due to the nature of the market. The mobile phone market changes according to the technological advantages that each
market player might possess, rendering it a very fast paced market. Therefore, a buyer signing a long-term contract with
a market player could lead to high losses, making short-term contracts more appealing as they present lower exit costs.
Overall, buyer power is assessed as strong.

Supplier power
Figure 8: Drivers of supplier power in the mobile phones market in India, 2018
Manufacturers are divided into two categories. Firstly, there are software manufacturers, such as Google, who produces
Android. This category does not apply to Apple and Microsoft mobile phones, as they produce their own operating
systems, although the dependence of other major players on software supply is crucial. Secondly, there are electronic
manufacturers who produce most of the components on a contract basis. Some of the largest semiconductor companies
in the mobile phone industry are Qualcomm, Foxconn, Jabil Circuit, Taiwanese Semiconductor Manufacturing Company
(TSMC), and Skyworks Solutions. As market players are typically much larger companies than suppliers, they are better
able to influence supply contracts. This also happens because mobile manufacturers tend to have more than one
supplier for a range of components.
What is more, mobile phone manufacturers have to be careful about who they choose to supply them, as unethical
suppliers could result in negative connotations with their brand image. The alleged poor treatment of factory workers at
companies such as Foxconn has increasingly been a focus of the market in recent years due to damning revelations
about the working conditions of the Taiwanese company which supplies components to the likes of Apple, BlackBerry,
Dell, Motorola, and Sony. However, the relatively small number of contract electronics manufacturers, and their
increasing size and diversity, tend to increase suppliers' power. In addition, market players are heavily reliant on the
quality and efficiency of the software and products provided in order to innovate.
Revenue that is generated from the supply of mobile phones to manufacturers is not essential to them, as suppliers
provide services to a wide range of industries, particularly in the electronics field. The same can be said for marketing
and advertising companies that provide services to the mobile phone market. There has been instability in raw material
prices and the uncertainty has been adversely affecting manufacturers' margins. The dependence of mobile phone
manufacturers on semiconductor suppliers is shown when these companies release increased earnings statements, as
mobile manufacturers' stock prices also increase, which is a sign of escalated demand. The trend towards smartphones
has strengthened supplier power, as more complex components require rare materials which need to be used in the
production process.
As entry barriers ease off in markets throughout the world, profitability is expected to switch from handset manufacturers
to the manufacturers of key performance enhancing components and modules (both hardware and software).

This market's supply chain is made more complicated by the fact that some players also act as suppliers. For instance,
Samsung – which enjoys a greater degree of diversification than some of its rivals in the market – manufactures a
proportion of Apple's iPhone processors. While Apple is seeking to reduce its reliance on Samsung in the wake of
increased competition and animosity between the two, this level of integration increases supplier power in Samsung's
case. Samsung's vertically integrated position also gives it a better competitive advantage so far as access to
components is concerned.
Switching costs for suppliers are higher than switching costs for buyers, decreasing supplier power. Suppliers have to
sign long-term contracts in order to get lower prices for the raw materials they require, as prices for raw materials are
easily affected by the stock market. Raw materials that originate from oil, steel and other commodities are very likely to
experience high levels of volatility. Thus, in order for suppliers to obtain them at lower prices, they would have to sign
long-term contracts.
Overall, supplier power is assessed as moderate.

New entrants
Figure 9: Factors influencing the likelihood of new entrants in the mobile phones market in
India, 2018
The increasing popularity of smartphones means several newcomers have successfully entered the market in recent
years, offering the basic functions of a regular mobile phone along with, for example, touchscreen, cameras, GPS
navigation, Wi-Fi and mobile broadband access. Smartphone devices are spreading across India as overall mobile
phone penetration grows, which provides a sooner rather than later opportunity to mobile manufacturers who are looking
to provide this market with their products.
The Indian market witnessed a decline in volume consumption levels in 2014 and 2015, largely thanks to protectionist
government policies which support Indian mobile phone manufacturers. For example, the duty on imported mobile
phones was increased from 6% to 12.5% in 2014, which increased the price of these mobiles by 4%. This reduction in
volume consumption levels reduces the threat of new entrants. However, rising wages have offset this effect to some
extent as more Indians are now opting for cheaper mobile phones, usually of Chinese origin. This is a potential segment
for new entrants to target.
In general, capital outlay involving research and development into new technology and production facilities is costly to
compete with the likes of Apple and Samsung. However, the market share of Apple in this market is negligible and
Samsung is the only player to compete with in terms of innovation. As a matter of fact, this market is available to new
entrants without them having to undertake a large capital investment, although these entrants will be subject to intensive
price competition with low-cost domestic incumbents.
What is more, there are restrictions in this market, most of which relate to human health and safety and environmental
issues. There are stringent laws relating to science-based regulation and the adoption of emission guidance by the
International Commission on Non-Ionizing Radiation. Furthermore, the effect of the use of mobile phones on health is
closely monitored, with studies being conducted on the possible side effects of the electromagnetic radiation produced
by mobile phones.
Additionally, new regulation in the Indian market, concerning mandatory Indian languages support on all mobile phones,
is considered a special standard for this market. What is more, the mandatory certification of consumer electronic
products from the Bureau of India Standards is usually time consuming.

Intellectual property rights can also serve as a strong barrier to entry, as the prolonged dispute between Samsung and
Apple over patents demonstrates. In 2013, Samsung was ordered to pay Apple $1.05bn in relation to mobile phone
software patents as part of a case that began in 2011. Patenting forces competitors to innovate, but success is not
guaranteed and other platforms, such as Windows Phone or Blackberry, have floundered in the market. The increasing
adoption of Android as the operating system of choice for many manufacturers (it has a global smartphone market share
of around 80%) has played a key role in this and illustrates how important it is to have an agreement with a sought-after
OS system developer.
Competition among big brand names in the market tends to be fierce, reducing the threat of new entrants. Big brand
names such as Apple and Samsung tend to compete constantly with each other, trying to produce the most innovative
and “cutting edge” mobile phone in order to obtain the market share of their competitors. Consumers in the market tend
to be highly influenced by the brand names of companies of that scale, influencing them to buy the new products of a
company based on the brand name alone. In addition, products from companies such as Apple are regarded as an
indicator of one’s social stature. This means that consumers sometimes buy very expensive phones, such as the iPhone
XR or Samsung Galaxy S10+, to show others that they have the financial means to buy such a high-priced device. This
strengthens the brand image of those mobile phone manufacturers, rendering entry to the market extremely difficult.
Moderate to high fixed costs are keeping new entrants at bay, as it hard to operate and maintain a profitable mobile
phone manufacturing company. In order for a market player to operate functionally, it has to be able to produce revenues
that surpass fixed costs to a great extent. Those fixed costs most of the time include high electricity bills, over-priced
rent, highly trained personnel, trucks and automobiles required for the transfer and logistic procedures of the products,
and others which are based on the size of the company. Most of the market players tend to be big in size, meaning that
they will have high fixed costs in order to maintain their facilities and transport their goods. Thus, they would have to be
very profitable in order to cover those costs, making them very competitive, reducing the chances of entry from smaller
companies.
Ultimately, the Indian market is an emerging market, where the smartphone segment still has significant room for growth,
so new players could acquire a share of the market. Only 67% of Indians possess a smartphone, meaning that potential
new entrants can target this segment. Apple's plans to target the Indian market demonstrates the validity of this
opportunity. The company is also looking to set up a manufacturing plant in India.
Overall, the threat of new entrants is assessed moderate in India.

Threat of substitutes
Figure 10: Factors influencing the threat of substitutes in the mobile phones market in India,
2018
One possible substitute for mobile phones is fixed line telephones. However, this threat is seen as minimal, as mobile
phones offer the advantage of being able to use them over a much wider geographical area – wherever they pick up a
signal. Not only this, but there has been an observed increase in households that have substituted fixed line telephones
with mobile phones. Moreover, many mobile phones now offer benefits that have enabled them to become substitutes for
many other electrical appliances, including laptops, televisions, MP3 players and cameras. Whilst laptops also offer
many of the features that mobile phones are marketed on, such as internet access, video calling through programs such
as Skype, email, TV, GPS, music and portability, they are not a strong substitute, as they do not possess many of the
benefits of a mobile phone, such as size, weight and the seamless ability to call others.
Tablet computers could be seen as a substitute for smartphones, but large-screened smartphones (known as "phablets")
negate this threat to a large extent. The fact that tablet sales have declined globally for the last several consecutive years
supports this. This has led to many players operating in the tablets market, such as HTC and Dell, pulling out of that
market, emphasizing the fact that the mobile phones market has successfully been able to counter the impact of this
potential substitute.
Overall, the threat of substitutes is assessed as weak.

Degree of rivalry
Figure 11: Drivers of degree of rivalry in the mobile phones market in India, 2018
The Indian mobile phones market is dominated by a small number of large-sized companies, such as Xiaomi and
Lenovo, and other domestic but significantly-sized manufacturers such as Micromax and Karbonn. Rivalry is increased
due to the limited number of competitors and the high penetration of mobile phone devices, which intensifies R&D
expenses and price competition. The introduction of smartphones has added another competitive dimension, with Apple
and those using the Android operating system (including HTC, LG, Samsung and Sony) establishing themselves as
major players. Simultaneously, some of the most established mobile phone manufacturers have experienced an adverse
effect.
Indian consumers are typically price sensitive. First of all, relatively small domestic manufacturers, such as Micromax
and Karbonn, are low-cost players who had a large customer base even before the smartphone expansion. Accordingly,
their success in the smartphone segment in India is based on this price sensitive consumer base. As a matter of fact,
Samsung, which already has an important market share, is expected to adopt a price-targeted strategy. In this way,
Samsung's innovative advantage would be more appealing in a lower price product. Lenovo is also expected to compete
efficiently with low-cost brands, even better than Samsung.
Additionally, Samsung and Lenovo's diversity of operations, coupled with their smaller dependence on this market, gives
them an advantage.
As the market progresses, the differentiation that premium devices hold over their budget competitors will diminish.
Consumers are already moving towards cheaper devices, bringing down the average selling price of mobile phones. As
such, market leaders are faced with a difficult decision to make: do they bring the price of their flagship models down to
compete more effectively with budget manufacturers; or do they invest in expensive R&D to give their next model a new
differentiating feature? Either would have a negative impact on profitability, and there is no guarantee that any
differentiating feature will be met with enthusiasm by consumers. Of course, most of the major manufacturers in this
market have a product range that spans the budget and premium sectors, but even a consumer shift from a
manufacturer's high-end offering to its mid-range selection of handsets would have a negative top and bottom-line
impact. In essence, as the number of budget offerings in the market increases, so too will the level of competition.

Existing market players such as Micromax Informatics, Lenovo, Xiaomi and BBK tend to be big in size and compete with
each other for the market leader position. The fact that there is more than one clear leader in the market increases
rivalry. Rivalry in the industry is highly influenced by the brand name of each of the market players. Brand names such
as Apple or Samsung are more recognizable and consumers tend to prefer these two brands because they are highly
regarded as social stature indicators, meaning that a consumer could indicate their social stature by the mobile phone
brand he or she possesses.
Overall, rivalry is assessed as strong.

LEADING COMPANIES
BBK Electronics Corp Ltd
Table 6: BBK Electronics Corp Ltd: key facts
126 Bubugao Road, Wusha Village Chang'an Town, Dongguan, 523860,

Head office:
CHN
Telephone: 86 769 8554 5555
Fax: 86 769 8554 0007
Website: www.gdbbk.com
SOURCE: COMPANY WEBSITE MARKETLINE
BBK Electronics Corp Ltd is a technology company headquartered in China which specializes in the manufacture of
consumer electronics. The company primarily researches, develops, produces and sells communication products, as
well as some educational electronics. BBK, with its subsidiary OPPO, is one of the major players in the mobile phone
market. BBK is one of the main investors in Chinese phone makers OnePlus, Vivo and Oppo, with a good R&D sector
employing more than 2,000 science and technology personnel. BBK has a strong presence in the US and Indonesia,
specializing in electronics such as TV sets, MP3 players, digital cameras and cell phones.
Key Metrics
As a privately owned company, BBK Electronics Corp Ltd is not obliged to release its financials.

Micromax Informatics Ltd
Table 7: Micromax Informatics Ltd: key facts
Head office: 288A, Udyog Vihar Phase IV, Gurgaon, Haryana, IND
Telephone: 91 124 4811000
Fax: 91 124 4811099
Website: www.micromaxinfo.com
Micromax Informatics Ltd (Micromax) is a manufacturer of consumer electronic products. The company’s products
include mobile phones, dual-SIM phones, 3G Android smart phones, phablets, tablets, LED televisions and data cards,
monitors, laptops, air conditioners and high definition LED televisions. It also provides 3G wireless and router data cards
with a maximum download and upload speed. Micromax operates through retail outlets located across India. The
company markets products in Russia, Bangladesh, Hong Kong, India, Nepal, Sri Lanka and the UAE. Micromax is
headquartered in Gurgaon, Haryana, India.
Key Metrics
As a privately owned company, Micromax Informatics is not obliged to release its financials.

Samsung Electronics Co., Ltd.
Table 8: Samsung Electronics Co., Ltd.: key facts
Head office: 129, Samsung-Ro, Yeongtong-Gu, Seoul, KOR

Telephone: 82 2 22550114
Website: www.samsung.com
Financial year-end: December
Ticker: 005930, SAMDR, SMSN
Stock exchange: Korea, Luxembourg, London
Samsung Electronics Co., Ltd. (Samsung or "the company") is an information technology (IT) company. The company
offers televisions (TVs), smartphones, tablets, personal computers (PCs), cameras, home appliances, long-term
evolutions (LTE) systems, medical devices, semiconductors and light-emitting diode (LED) solutions. Samsung has
operations in Asia, the Americas, Europe, the Middle East and Africa. As of December 2018, the company had 214
worldwide operation hubs, including 39 manufacturing sites, 55 sales offices, seven design centers, 35 R&D centers, and
16 regional offices.
The company classifies its business operations into four reportable segments: Information Technology and Mobile
Communications (IM), Consumer Electronics (CE), Device Solutions and Harman.
The Information Technology and Mobile Communications segment includes the company's mobile communications and
networks businesses. The segment offers mobile phones, communication systems, and computers.
The Consumer Electronics segment includes the visual display, digital appliance and health and medical equipment
businesses. The company's visual display business offers TVs and monitors. The digital appliance business offers
refrigerators, washing machines and air-conditioners. The health and medical equipment business offers digital X-rays,
diagnostic imaging devices, diagnostic ultrasound systems, digital radiography systems, mobile CT scanners and in-vitro
diagnostics devices.
The Device Solutions segment comprises the semiconductor business and display (DP) business. Under the
semiconductor business, the company offers memory, foundry and system LSI products. In the display business, the
company provides LCD and OLED panels.
The Harman segment offers connected car systems, audio and visual products, enterprise automation solutions and
connected services.
Geographically, the company classifies its operations into five segments: China, Korea, the Americas, Europe, and Asia
and Africa.
Key Metrics
The company recorded revenues of $221,510 million in the fiscal year ending December 2018, an increase of 1.8%
compared to fiscal 2017. Its net income was $39,883 million in fiscal 2018, compared to a net income of $37,569 million
in the preceding year.

Table 9: Samsung Electronics Co., Ltd.: key financials ($)
$ million 2014 2015 2016 2017 2018

Revenues 187,375.5 182,330.0 183,432.5 217,697.6 221,510.5
Net income (loss) 20,974.6 16,987.5 20,650.8 37,569.0 39,882.8
Total assets 209,381.0 220,064.0 238,232.9 274,196.4 308,367.5
Total liabilities 56,642.4 62,974.1 62,891.0 85,905.5 218,146.2
SOURCE: COMPANY FILINGS MARKETLINE
Table 10: Samsung Electronics Co., Ltd.: key financials (KRW)
KRW million 2014 2015 2016 2017 2018

206,205,987. 200,653,482. 201,866,745. 239,575,376. 243,771,415.
Revenues
0 0 0 0 0
Net income (loss) 23,082,499.0 18,694,628.0 22,726,092.0 41,344,569.0 43,890,877.0
230,422,958. 242,179,521. 262,174,324. 301,752,090. 339,357,244.
Total assets
0 0 0 0 0
240,068,993.
Total liabilities 62,334,770.0 69,302,754.0 69,211,291.0 94,538,674.0
0
Table 11: Samsung Electronics Co., Ltd.: key financial ratios
Ratio 2014 2015 2016 2017 2018

Profit margin 11.2% 9.3% 11.3% 17.3% 18.0%
Revenue growth (9.8%) (2.7%) 0.6% 18.7% 1.8%
Asset growth 7.6% 5.1% 8.3% 15.1% 12.5%
Liabilities growth (2.7%) 11.2% (0.1%) 36.6% 153.9%
Debt/asset ratio 27.1% 28.6% 26.4% 31.3% 70.7%
Return on assets 10.4% 7.9% 9.0% 14.7% 13.7%

Figure 12: Samsung Electronics Co., Ltd.: revenues & profitability
Figure 13: Samsung Electronics Co., Ltd.: assets & liabilities

Xiaomi Inc
Table 12: Xiaomi Inc: key facts
Xiaomi Office Building, 68 Qinghe Middle Street, Haidian District, Beijing,

Head office:
100085, CHN
Telephone: 86 10 6060 6666
Fax: 86 10 6060 6666
Website: www.mi.com
Xiaomi Inc. (Xiaomi) is a Chinese electronics and technology company. The company's product range includes
smartphones, tablet computers, televisions, set-top boxes, headphones and wearables. In order to retain lower prices,
the company sells its products directly to consumers in China, Taiwan, Hong Kong, Singapore, Malaysia, the Philippines,
India and Indonesia. Xiaomi was founded in 2010 and has since grown to become one of the world's largest smartphone
manufacturers, selling more than 70 million smartphones in 2018.
Key Metrics
As a privately owned company, Xiaomi Inc. is not obliged to publish its financial results.

MACROECONOMIC INDICATORS
Country data
Table 13: India size of population (million), 2014–18
Year Population (million) % Growth

2014 1,238.9 1.3%
2015 1,254.0 1.2%
2016 1,269.0 1.2%
2017 1,283.6 1.2%
2018 1,298.0 1.1%
Table 14: India gdp (constant 2005 prices, $ billion), 2014–18
Year Constant 2005 Prices, $ billion % Growth

2014 1,595.4 7.4%
2015 1,716.1 7.6%
2016 1,847.6 7.7%
2017 1,990.6 7.7%
2018 2,146.3 7.8%
Table 15: India gdp (current prices, $ billion), 2014–18
Year Current Prices, $ billion % Growth

2014 2,045.6 9.0%
2015 2,337.2 14.3%
2016 2,671.5 14.3%
2017 3,035.3 13.6%
2018 3,453.7 13.8%

Table 16: India inflation, 2014–18
Year Inflation Rate (%)

2014 7.7%
2015 7.2%
2016 6.7%
2017 6.4%
2018 6.3%
Table 17: India consumer price index (absolute), 2014–18
Year Consumer Price Index (2005 = 100)

2014 215.6
2015 231.0
2016 246.5
2017 262.2
2018 278.7
Table 18: India exchange rate, 2014–18
Year Exchange rate ($/Rs.) Exchange rate (€/Rs.)

2014 60.9620 80.8938
2015 64.1233 71.1453
2016 67.1794 74.3472
2017 65.0484 73.5945
2018 68.4090 80.6918

METHODOLOGY
MarketLine Industry Profiles draw on extensive primary and secondary research, all aggregated, analyzed, cross-
checked and presented in a consistent and accessible style.
Review of in-house databases – Created using 250,000+ industry interviews and consumer surveys and supported by
analysis from industry experts using highly complex modeling & forecasting tools, MarketLine’s in-house databases
provide the foundation for all related industry profiles
Preparatory research – We also maintain extensive in-house databases of news, analyst commentary, company
profiles and macroeconomic & demographic information, which enable our researchers to build an accurate market
overview
Definitions – Market definitions are standardized to allow comparison from country to country. The parameters of each
definition are carefully reviewed at the start of the research process to ensure they match the requirements of both the
market and our clients
Extensive secondary research activities ensure we are always fully up-to-date with the latest industry events and
trends
MarketLine aggregates and analyzes a number of secondary information sources, including:
- National/Governmental statistics
- International data (official international sources)
- National and International trade associations
- Broker and analyst reports
- Company Annual Reports
- Business information libraries and databases
Modeling & forecasting tools – MarketLine has developed powerful tools that allow quantitative and qualitative data to
be combined with related macroeconomic and demographic drivers to create market models and forecasts, which can
then be refined according to specific competitive, regulatory and demand-related factors
Continuous quality control ensures that our processes and profiles remain focused, accurate and up-to-date

Industry associations
GSMA
Floor 2, The Walbrook Building, 25 Walbrook, London, EC4N 8AF, GBR
Tel.: 44 207 356 0600
Fax: 44 20 7356 0601
www.gsma.com
CTIA - The Wireless Association
1400 16th Street, NW, Suite 600, Washington, DC 20036, USA
Tel.: 1 202 785 0081
Fax: 1 202 785 0721
www.ctia.org
Electronic Industries Association of India
ELCINA House, 422 Okhla Industrial Estate, New Delhi, 110020, IND
Tel.: 91 011 26924597
Fax: 91 011 26923440
www.elcina.com
Related MarketLine research

Industry Profile
Mobile Phones in the United States
Global Mobile Phones
Mobile Phones in Europe
Mobile Phones in Asia-Pacific
Mobile Phones in China

APPENDIX
About MarketLine
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countries across the world. No other business information company comes close to matching our sheer breadth of
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And unlike many of our competitors, we cut the ‘data padding’ and present information in easy-to-digest formats, so you
can absorb key facts in minutes, not hours.
What we do
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With stringent checks and controls to capture and validate the accuracy of our data, you can be confident in MarketLine
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Disclaimer
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MarketLine Industry Profile

Reference Code: 0102-0152

Publication Date: May 2019

India - Mobile Phones 0102 - 0152 - 2018

© MARKETLINE THIS PROFILE IS A LICENSED PRODUCT AND IS NOT TO BE PHOTOCOPIED Page | 1

Market value forecast

Market volume forecast

India - Mobile Phones 0102 - 0152 - 2018

© MARKETLINE THIS PROFILE IS A LICENSED PRODUCT AND IS NOT TO BE PHOTOCOPIED Page | 2

Market value ................................................................................................................................................................ 2

Market value forecast .................................................................................................................................................. 2

Market volume ............................................................................................................................................................. 2

Market volume forecast ............................................................................................................................................... 2

Geography segmentation ............................................................................................................................................ 2

Market rivalry ............................................................................................................................................................... 2

Market definition .......................................................................................................................................................... 7

Market Data ..................................................................................................................................................................... 9

Market value ................................................................................................................................................................ 9

Market volume ........................................................................................................................................................... 10

Market Segmentation .................................................................................................................................................... 11

Geography segmentation .......................................................................................................................................... 11

Market Outlook .............................................................................................................................................................. 12

Market value forecast ................................................................................................................................................ 12

Market volume forecast ............................................................................................................................................. 13

Five Forces Analysis ..................................................................................................................................................... 14

Buyer power .............................................................................................................................................................. 15

New entrants ............................................................................................................................................................. 18

Threat of substitutes .................................................................................................................................................. 20

Degree of rivalry ........................................................................................................................................................ 21

BBK Electronics Corp Ltd .......................................................................................................................................... 23

Micromax Informatics Ltd .......................................................................................................................................... 24

Samsung Electronics Co., Ltd. .................................................................................................................................. 25

Xiaomi Inc .................................................................................................................................................................. 28

India - Mobile Phones 0102 - 0152 - 2018

© MARKETLINE THIS PROFILE IS A LICENSED PRODUCT AND IS NOT TO BE PHOTOCOPIED Page | 3

Industry associations ................................................................................................................................................. 32

Related MarketLine research .................................................................................................................................... 32

About MarketLine ...................................................................................................................................................... 33

India - Mobile Phones 0102 - 0152 - 2018

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Table 3: India mobile phones market geography segmentation: $ billion, 2018............................................................11

Table 4: India mobile phones market value forecast: $ billion, 2018–23.......................................................................12

Table 6: BBK Electronics Corp Ltd: key facts................................................................................................................23

Table 7: Micromax Informatics Ltd: key facts ................................................................................................................24

Table 8: Samsung Electronics Co., Ltd.: key facts ........................................................................................................25

Table 9: Samsung Electronics Co., Ltd.: key financials ($) ...........................................................................................26

Table 10: Samsung Electronics Co., Ltd.: key financials (KRW)...................................................................................26

Table 11: Samsung Electronics Co., Ltd.: key financial ratios.......................................................................................26

Table 12: Xiaomi Inc: key facts...................................................................................................................................... 28

Table 13: India size of population (million), 2014–18 ....................................................................................................29

Table 15: India gdp (current prices, $ billion), 2014–18 ................................................................................................29

Table 16: India inflation, 2014–18 ................................................................................................................................. 30

Table 17: India consumer price index (absolute), 2014–18...........................................................................................30

Table 18: India exchange rate, 2014–18 .......................................................................................................................30

India - Mobile Phones 0102 - 0152 - 2018

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Figure 2: India mobile phones market volume: Average MOU, 2014–18......................................................................10