Bengaluru, Jul 22 (IANS): The smartphone shipments reached 36.4 million units in the second quarter (Q2) in India, a 5 per cent decrease from the previous quarter, with major brands struggling to shift units as consumer demand dwindled, a new report has shown.

Xiaomi retained its market-leading position, shipping 7 million units, despite experiencing another quarter of both annual and sequential decline.

With 6.7 million shipments, Samsung came second, pulling closer to Xiaomi.

Remaining in third place, realme shipped 6.1 million units, while vivo and OPPO completed the top five, shipping 6 million and 5.5 million units, respectively.

"Top Chinese brands, such as Xiaomi, vivo and OPPO, struggled with government scrutiny as well as financial problems. But the business impact remained limited, with no major changes in the vendor shares," said analyst Sanyam Chaurasia.

In the premium segment, Samsung's positive reception for its flagship S series boosted its value share, while Apple is using India's performance–linked incentive (PLI) scheme to make the iPhone 13 locally and support future aggressive pricing, he added.

The smartphone players in India are looking to leverage strong channel collaboration as smartphone inventory is getting alarmingly high.

"Brands are using early deep discount sales, which began in June via the ecommerce channel, to get rid of stock before the holiday season kicks in. There will be more of these monsoon season sales on Flipkart and Amazon, with significant discounts to stimulate demand and prepare for upcoming launches in Q3," said Chaurasia.

While the second half of the year will not see a surge in pent-up demand like last year, the rebound through the festival holiday season will be driven by replacement purchases.

The weakening Indian rupee, rising retail prices and Chinese brands' compliance risks are hindering growth in the sub-$200 segment, the analyst said.