Smartphone Prices May Rise From Next Quarter: Report (Photo by Jonas Leupe on Unsplash)
The prices of smartphones in India may increase from June this year. According to a report in the Economic Times, this price hike is the result of an increase in memory chip prices and the strengthening of the Chinese yuan.
The ET Telecom report, citing data from market research firm Trendforce, pointed out that there is an upward trend in DRAM (memory chips) prices, with both Micron and Samsung planning to increase the price of their DRAM chips. Notably, Samsung and Micron are the major players in this segment. The report said that both companies are likely to implement a 15-20 percent price hike in the March quarter. According to Trendforce, this hike is mainly due to the tighter supply of DRAM this year following the accelerated adoption of AI, coupled with a gradual recovery in the smartphone and PC markets.
The impact of the price hike will be felt from the next quarter onward, an anonymous industry executive told ET. The executive also added that this is because most companies currently have the necessary inventory of components to supply products in the March quarter. The executive said that the price of memory chips may rise by around 10–15 percent by late February or the start of March. At the same time, the report also said that the recently introduced tax cuts could help nullify the impact of price hikes in the country.
Notably, the central government has recently reduced the import duty for components used in the manufacture of mobile phones. The Centre has slashed the import duty from 15 percent to 10 percent, as per the government notification on January 30.
The report also indicates that brands may start offering lower memory and storage in the budget smartphone segment instead of raising handset prices. Shilpi Jain, senior research analyst at Counterpoint Research, told ET that brands have been offering up to 8GB of RAM and 256GB of storage under Rs 10,000 due to lower memory prices. However, after the memory price hike, this may be impacted.
