India’s Mobile phone exports may reach $9-10 billion in FY23 with PLI support

New Delhi: Mobile phone exports are likely to reach between $9 billion and $10 billion levels in value in FY23, industry insiders and experts said, which is a significant jump from ₹45,000 crore worth of phones exported in FY 22.

In recent months, exports have touched $1 billion a month, and the trend is likely to continue in the next quarter, a senior industry executive said, adding that the vast majority of exports by value were made by Samsung and Apple.

“Last year smartphone exports were at ₹ 45,000 crore, this year we have already crossed that number and made around $1 billion per month. At this rate, we should reach $9 billion this year,” said Pankaj Mohindroo, President of the Indian Cellular and Electronics Association that represents mobile phone manufacturers in the country.

According to data from Counterpoint Research, from January to November this year, exports increased by 23% year-on-year, and a double-digit growth rate is likely to continue for the remaining months, on the back of production-related incentives. offered by the government.

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“The key contributor to the increase in exports has been the PLI scheme which has benefited manufacturers and brands and boosted the overall manufacturing ecosystem,” said Prachir Singh, Senior Analyst with Counterpoint Research.

The increase in exports comes at a time when India-made smartphone shipments fell for the first time, down 8% year-on-year in July-September to over 52 million units, largely due to falling consumer demand in economic headwinds and market uncertainties due to geopolitical changes, as per counterpoint data.

In India’s smartphone manufacturing ecosystem, 63% of shipments come from in-house manufacturers and 37% from third-party electronics manufacturing service providers such as Bharat FIH, which makes for Xiaomi and Dixon Technologies, which also makes for Samsung. OPPO had the largest share of made in India smartphone shipments with 24% share, followed by Samsung and Vivo. Oppo makes phones for its own brands OPPO, Realme and OnePlus.

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“We will continue to see PLI payouts in subsequent quarters, adding to the local manufacturing landscape. Overall, the manufacturing trend is witnessing an upward trajectory with multiple partnerships happening in recent months, such as those between Tata Group and Wistron and between Foxconn and Vedanta. Analysts of the company said in a note.

The government’s PLI scheme for mobile phone manufacturing has been a huge success with big brands like Apple, Samsung and Motorola benefiting from it. According to government data, 31 companies are expected to produce electronics worth INR 10 trillion with an investment of INR 10,818 crore over five years. India’s policies have consistently given a push to local manufacturing, exports as well as making the country an important player in the global supply value chain.

“This year, we expect the exports to close around 25 million units of phones with a value of over 7 billion dollars,” said Faizal Kawoosa, founder of the research company TechArc, a more conservative outlook.

“Export of mobile phones from India is a huge opportunity with a lot of growth and scale. However, there is a need for very proactive support from the government through PLI like speedy clearance of exports, etc. With 5G upgrade taking place globally, it a good opportunity for exponential export growth,” said Faizal Kawoosa, founder of research firm TechArc.

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Data from Counterpoint shows that Samsung was the largest exporter with 76% share of exports, followed by Apple with 16% and Motorola with 3% share of volume or units of exports. In the period of January-November 2021, Apple’s share more than doubled from 7% of exports, while Xiaomi, which had an 8% share of exports, did not figure in the top three export brands.

Navkendar Singh, associate vice president, device research at IDC India said that the share of Samsung’s exports was still much higher than Apple’s due to the large volumes of smartphones it exports, even though the average selling price was over $1000 per piece.

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