Samsung is targeting $10 billion worth of sales in India over the course of this year, The Economic Times reported Monday, citing an unnamed company official.
The tech giant’s performance in the South Asian country is expected to be largely fueled by select consumer electronics categories such as smartphones, appliances, and TVs, with its main goal being reviving its overall growth in India that slowed down last year.
Samsung recorded just under $9 billion in revenue over the entire 2017 and while its local business continued to grow, certain units faced tough competition.
Xiaomi is now said to be outpacing the company‘s mobile division and has already exceeded its shipment volumes in the final quarter of 2017, according to some industry trackers, though Samsung still claims it’s dominating the market in terms of sell-through performance, i.e. sales to consumers.
The South Korean electronics maker repeatedly acknowledged the threat posed by Xiaomi but remains confident it can hit its newly disclosed $10 billion sales target in 2018 by relying on its mobile business.
The stagnation experienced throughout last year is largely explained by New Delhi’s unexpected demonetization of some popular high-value banknotes in late 2016 which left the country’s economy strapped for cash.
The decision propelled the mobile payments solutions industry and the situation has now largely stabilized, with consumers being expected to spend more money on electronics than they did last year.
Extra taxes and duty fees imposed as part of the growing “Make in India” initiative also impacted Samsung’s business in recent times, prompting the firm to make additional investments in local manufacture and assembly lines so as to ensure the long-term sustainability of its business even as New Delhi continues to push for increasingly protectionist economic policies, some industry watchers believe.
Approximately 60-percent of the company’s 2018 sales in India are expected to be those of smartphones, according to recent reports. As was the case in previous years, Samsung’s local income will largely be driven by ultra-premium products across all categories which come with high-profit margins. The flagship segment of the smartphone market is far from the most popular one in India but it’s also the sector in which Samsung remains largely unchallenged, especially in the context of Android.