Higher component prices, shallower discounts, and Apple’s premium pull leave budget brands struggling ahead of India’s peak shopping season.
India’s smartphone sector is bracing for a lukewarm festive shopping period as a combination of price increases, diminishing promotional discounts, and Apple’s strong pull in the premium market squeeze consumer budgets.
Rising component costs—particularly memory chips driven higher by surging demand for AI data centres—have forced major manufacturers including Samsung, Xiaomi, Realme, Oppo, and Vivo to adjust retail prices upward. Industry analysis indicates that smartphone prices rose by approximately 15 per cent in the first half of the year, with further increases expected as manufacturers pass supply chain pressures on to consumers.
While festive shopping events traditionally offer substantial price cuts, recent market studies show that advertised deals are largely masking prior price hikes. Many models on major e-commerce platforms remain listed above their original launch prices, even after seasonal promotional discounts and bank card offers are applied. Consequently, genuine bargains are becoming increasingly rare for mid-range and budget shoppers.
IDC expects the sub-$100 segment to decline by 80 percent in 2026, while the $100-200 segment may suffer a 9 per cent decline. On the other hand, while the $200-400 segments may see a single-digit decline, the $400-600 segment is expected to grow at a double-digit growth rate. Segments above $600 may also see a single digit decline on a Year-on-Year basis.
Counterpoint research also expects a double digit decline in volumes. In July, the market was down 14 per cent year-on-year shipment, while footfall and sales were down by 27 per cent in the last two weeks.
At the same time as mid-range brands struggle with thin margins, Apple continues to consolidate its hold over higher-end buyers. By keeping price adjustments relatively stable on older and base models, Apple has attracted consumers who are increasingly opting for previous-generation premium iPhones over newly inflated mid-tier Android devices. Industry analysts expect overall shipment growth to remain subdued through the upcoming peak sales window, with market growth driven primarily by value rather than unit volume.
Retailers said they have secured an additional one to two months of inventory at older prices to protect margins. They also expect online festive-sale shortages and order cancellations to push some consumers back to brick-and-mortar stores.
