Xiaomi has replaced Samsung as the leading smartphone vendor in India, after grabbing 27% of the market share in December quarter, according to Singapore based market research firm Canalys. Around 30 million smartphones were shipped in India in Q4 2017 at a quarter on quarter (QoQ) growth rate of 6%. Xiaomi shipped 8.2 million units, while the South Korean company, which posted an annual growth of 17%, shipped 7.3 million units and now holds 25% of the market share. According to Canalys report for Q3, 2017, both companies were tied with 23% market share in September quarter.

Another research firm Counterpoint, in its latest Market monitor on smartphones for 4Q 2017, puts Xiaomi ahead of Samsung with market share of 25%, while the latter is trailing it by 2%.

Samsung has disagreed with the Canalys report and claims it still holds 40% of the market share in India. In an official statement, the South Korean company says, “Samsung is India’s number 1 smartphone company by a distance. As per a German research company GfK, which tracks sales to end consumers in the last (November) quarter Samsung had a 45% value market share and 40% volume market share. Samsung is a full range player and leads the smartphone business across every segment of the India market in 2017," according to a Samsung spokesperson over an email.

This is the first major shake up at the top in years. Most of the tussle in the smartphone market had been between Indian phone makers such as Micromax, Intex and Karbonn and the Chinese counterparts such as Xiaomi, Lenovo, Vivo and Oppo, while Samsung had remained unshakeable at the top.

The last quarterly tracker by US-based research agency IDC (International Data Corporation) for Q3, 2017, had put the two companies at par with each other. Xiaomi had tied up with Samsung with 23.5% market share to emerge as the joint number one smartphone vendor in India. IDC’s report for Q4 2017 has not been released yet.

Vivo, Oppo and Lenovo are the next three vendors in the top five list, suggests the report, without giving any specifics into their exact market share and shipments.

Researchers at Canalys have attributed Xiaomi’s success to its high quality products and trust in local leadership. “The key reason for Xiaomi’s success lies in the autonomy that it granted its Indian unit, letting it run the business locally. Localization in channel strategy, marketing and products has been evident in Xiaomi’s Indian operations," said Ishan Dutt, Research Analyst at Canalys. Xiaomi has also been more aggressive than other companies when it comes to pricing. Devices such as Redmi Note 4 bring more value and features to the table than any of their rivals.

The report points out that despite a superior R&D and supply chain, demand for Samsung’s smartphones have been weak in Q4 due to their failure to rally cost conscious consumers in the share in the sub Rs15,000 segment.

Researchers at Canalys believe Xiaomi won’t be able to grow at the same rate in 2018 as their market share is reaching a saturation point in India and the market in China continues to shrink.

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