One of India’s top smartphone brands is likely to implode

Photo credit: kues / 123RF.

Intex, one of India’s top smartphone companies, is staring down a rabbit hole, as per a report in The Economic Times.

The company, which Counterpoint pegged as the third largest in smartphone shipments in the second quarter of 2016, has lost around 200 employees, including senior leaders, the paper said.

“They usually do Rs 300-325 crores [US$44.8 million-US$52.2 million] of handset sales in a month. This month, they are at around Rs 150 crores [US$22.4 million] so far and by August end, will likely do around Rs 250 crores [US$37.3 million],” a company insider told the paper.

A lack of clear product strategy ahead of the upcoming festive season and supply chain issues are to blame, another source said.

However, Intex has denied that is the case.

Chief financial officer Rajeev Jain told The Economic Times that the handset maker was changing its management strategy, and has brought on board a new professional team. Rajeev said the company grew at about 80 percent annually over the past four years and sales rose 36 percent year-on-year from April to June, at 6.1 million phones.

An Intex spokesperson told Tech in Asia the loss of employees was over a period of time, but did not share further details. If they do, we will update.

India is an important market for phone makers across the world, including Apple, Samsung, and Xiaomi. Whether the reports about Intex are true or not, the Indian smartphone industry is surely headed toward a different chapter in the next few months.

Apple has been making inroads in India. Photo credit: Gartner says smartphone sales will flatten out in China and North America but zoom up by 29 percent in India this year.

Overall, global smartphone sales will slow down to single digit growth at 7 percent in 2016.

More than 100 different smartphone brands sell in the country, according to industry analysts. Traditionally, about a third of the smartphones used in the country are priced around or below US$100, but there has been a gradual shift toward better quality and higher priced devices.

It goes without saying, then, that the next couple of years will see a bare-knuckle fight of brands trying to stay relevant in the country. With giants like Apple trying to make a bigger market for themselves here, it will get tough for home grown brands to compete on just price. And there isn’t any way 100 different brands can all exist and grow.