India's smartphone sales volumes are expected to fall 12% this festive season while the market value climbs 5%, a shift driven by higher memory costs that have pushed up device prices and forced many buyers to postpone purchases or rely on financing and trade‑in offers.
Tarun Pathak, research director at Counterpoint Research, warned that the key challenge will be the size of the active consumer pool, noting that rising prices are likely to keep many consumers on the sidelines and push discretionary upgrades into the future.
Sreevathsa Prabhakar, CEO of Servify, said trade‑in volumes in October and November typically run 50% higher than in regular months, with the company handling over 300,000 device returns annually. She added that upgrades in the Rs 60,000‑1 lakh segment are driven largely by financing and trade‑ins, while demand for phones above Rs 1 lakh—incl. foldables—comes from existing premium users upgrading every 12‑24 months.
Trade‑in demand is spreading beyond metros into Tier‑2 and Tier‑3 cities, indicating that premiumisation is reaching smaller markets. Servify reports that premium phones enjoy 30‑40% higher protection attach rates than mid‑range models, and these protection plans are increasingly bundled with financing and upgrade schemes.
With manufacturers unable to offer deep discounts due to rising component costs, attractive exchange values, seamless financing, and assured buy‑back programmes are expected to be decisive in driving festive sales and cushioning the volume decline.