Is memory chip crunch wiping out ₹10K smartphone market in India?
As per an IDC estimate, nearly 173 million sub-₹10K smartphones, which shipped last year, are facing an existential crisis. In Q2 2026, this segment saw an almost 60% YoY drop
The memory chip shortage is causing significant challenges for the sub-₹10,000 smartphone market in India, driving many brands to increase prices and some to consider wiping out the entire category. With over 300% year-over-year increase in memory prices, the bill of materials for these budget devices has become increasingly difficult to manage.
According to IDC, nearly 173 million sub-₹10,000 smartphones shipped last year are now facing an existential crisis. Q2 2026 saw a 60% year-over-year drop in this segment, and this decline is expected to continue until 2028. Smartphone makers are shifting towards mid and premium segments to minimize the cost burden and sustain market growth in value over volume.
Industry experts predict that the sub-₹10,000 category may face a complete wipeout unless brands sell devices at a loss or adopt alternative business models. Some older phones might still be sold, and second-hand devices could find a place in this segment. The share of the sub-₹10,000 segment has dropped from 19% in Q2 2025 to just 4% in Q2 2026, with sales declining 81% year-over-year.
Even the ₹10,000–₹20,000 segment has seen a 7% decline as some devices move above ₹20,000 due to price hikes. To cope with the rising memory prices, smartphone makers are reintroducing 4G phones, which have lifted 4G's share to 11.1% in the current quarter. However, this is a temporary fix, and once inventory runs out, there will be little room left to offer devices this cheap.
Buyers are increasingly turning to refurbished smartphones as a more affordable alternative. This shift is being driven by trust in companies offering standardized quality checks, transparent grading, warranties, and return policies. As the budget phone segment continues to suffer the most, the impact is expected to linger in the near term.
The market is gradually shifting towards mid- and premium-segment devices, leaving the budget category with fewer options and reduced growth potential.
Written by urgent.news from The Hindu - Sci-Tech's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
