Samsung Begins India Assembly of Pricey Flagship Smartphones

(Bloomberg) -- Samsung Electronics Co. has begun making its fold and flip smartphones as well as its latest Galaxy S23 flagship in India, renewing its focus on a key growth market where Chinese devices have eaten into its sales.

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The South Korean giant’s Indian unit previously imported some of its premium flip and fold devices into the world’s second-biggest smartphone market, but is now assembling its entire phone portfolio locally, Raju Pullan, the head of Samsung’s mobile business in the country, said in an interview on Monday.

“That also builds on our strong commitment to growing the India market,” Pullan said, declining to comment on whether the locally assembled flagship devices will be priced lower than the imported ones.

Global smartphone leader Samsung has faced stiff competition from Chinese rivals in an Indian market characterized by cost-conscious shoppers. China’s Xiaomi Corp. was India’s biggest smartphone vendor in 2022 with a market share of 20%, while Samsung was a close second at 19%, according to research firm Canalys.

For years, lower prices, bigger batteries and a marketing blitz resting on cricket and Bollywood have helped Chinese device makers outsell Samsung.

Samsung has been slow to learn but is gradually catching up by launching more affordable devices, tying up with banks for credit card offers and rolling out a consumer credit program that helped it sell devices worth $1 billion in 2022, Pullan said.

Like rival Apple Inc., Samsung is also participating in Prime Minister Narendra Modi’s manufacturing drive that aims to turn India into an export hub. Still, Samsung has struggled to collect some of the financial incentives it has sought from the Modi administration, even as manufacturers including Apple supplier Foxconn Technology Group have succeeded with their claims.

Samsung, which last week unveiled its latest iPhone-rivaling Galaxy S23 line, received orders for nearly 140,000 units worth about 14 billion rupees ($169 million) in India in the 24 hours after the launch, Pullan said. That’s double the orders Samsung received for the previous generation of Galaxy devices on the first day.

The company is increasing the number of stores where it sells the Galaxy devices and investing more in sales and marketing, Pullan said, without giving specifics. Samsung has set up an India-focused mobile research center and is building out production bases in the country, TM Roh, president of Samsung’s smartphone business, said in a separate interview last month.

“India is a crucial market that we’d like to take back,” Roh said.

--With assistance from Sohee Kim.

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