Daijiworld Media Network - New Delhi

New Delhi, Sep 29: Average smartphone selling prices in India rose 16 per cent year-on-year in the first half of 2026, driven by higher memory component costs and a depreciating rupee, according to market research firm Counterpoint Research.

The increase pushed the average smartphone selling price in India to a record $318 in the second quarter of 2026. Counterpoint said the overall smartphone market is now expected to contract by double digits.

The entry-level segment was hit the hardest, with smartphones priced below Rs 10,000 recording an average price increase of around 32 per cent during the first half of the year.

Since memory components account for a larger share of the bill of materials for lower-priced devices, the increase in memory costs had a greater impact on this segment.

Shipments of smartphones priced below Rs 10,000 consequently plunged 65 per cent year-on-year in H1 2026. The Rs 10,000-Rs 15,000 segment, traditionally a major volume driver in India, also recorded a 20 per cent decline.

The premium segment, however, remained relatively resilient. Smartphones priced above Rs 20,000 continued to grow, supported by higher launch prices, trade-in programmes and wider availability of no-cost EMI options, which helped reduce the impact of higher upfront prices on consumers.

Despite nearly 99 per cent of mobile phones sold in India being assembled domestically, manufacturers continue to depend heavily on imported components, leaving them exposed to global supply constraints and currency movements.

"In a cost shock scenario like this, brands usually have to pick between two choices — hold prices and give up margin, or protect margin and give up volume," said Tarun Pathak, Research Director at Counterpoint Research.

Counterpoint expects the pressure on smartphone manufacturers to persist, with memory costs likely to remain elevated through at least 2028.