India's smartphone market is set to hit a record high of 173 million units in 2021, growing at 14% year-on-year, according to Counterpoint Research.
More than 100 million smartphones are expected to be shipped in the 2nd half of the year, it said.
The market has been experiencing strong consumer demand after the lifting of COVID-19 restrictions in June 2021, and the strong sales momentum will continue during the festive season from August to November 2021, it added.
India's smartphone market is the 2nd biggest market in the world after China. In year 2020, the Indian market outperformed the North America, Latin America and Africa markets.
"Our outlook for India for the next 5 years remains positive, keeping in mind its 1.39-billion population, upgrade of users from feature phone to smartphone, and future emergence of new use cases. The market is set to cross the 200 million mark in the next couple of years," Counterpoint said.
The research firm noted that the market has been experiencing a steady growth curve over the last 5 years to reach 158 million units in year 2019.
COVID-19 saw shipment experiencing a minor dip of 4% in 2020 to 152 million units (from 158 million units in 2019), showcasing its resilience as well as the emergence of smartphones in a more important role to cater to the pandemic-triggered need for digital communication and newer use cases.
"The biggest factor pushing the market could be the launch of Reliance Jio's low-cost Android phone JioPhone Next in September 2021, which will enable migration of feature phone users to smartphones," it said.
Counterpoint said the JioPhone Next phone is expected to be priced below USD 75 a price point that hasn't seen major activity in the last 2 years.
"If it works as expected, we might see the Indian market entering a period of hyper-growth...The country has a considerable installed base of 320 million feature phone users. Getting these feature phone users is the key to realising the full potential of India's smartphone opportunity," it added.
On the 5G segment, Counterpoint said 5G smartphones accounted for less than 3% of the market in year 2020.
In 2021, the market for 5G devices will grow over 8 times to reach 32 million units and makeup 19% of the overall smartphone market.
Intense competition among OEMs, availability of cheaper 5G chipsets and declining prices of 5G devices will lead to more 5G devices being pushed into the market, it said adding that the average price of entry-level 5G devices has come down by 40% in the last 12 months. The cheapest phone with 5G now costs less than Rs 15,000 (around $200).