Note 7 debacle may hit Samsung’s India revenues by Rs 6,500 crore: Study

NEW DELHI: Galaxy Note 7 battery issue that led to its recall and later halt of production worldwide may hit Samsung’s smartphone shipments target and lower it by 4 million units for the calendar year 2016, according to an impact analysis done by research firm, CMR. This translates to Rs 6,457cr in terms of revenues for the company.

Faisal Kawoosa, Principal Analyst for Telecoms at CMR said, “A perception, right or wrong, gets built within the market that if the issue is with the high-end premium model, there could be issues in the other models too.”

“Though Note 7 is a high-end premium smartphone, the impact would be on Samsung spanning all across the segments. The issue is faced with the flagship model of the year that too around festive season, as a result, customers’ confidence is shaken,”added he.

As per projected growth, Samsung was expected to touch revenues of Rs 45,446cr in CY 2016, an increase of 46 per cent compared to previous calendar year. However, following the Note 7 issue, it can earn revenues of Rs 38,989cr, which means a growth of 25 per cent in revenues in CY 2016.

Samsung, however, will continue to maintain leadership in the smartphone segment in India, but its market share will shrink by 4.2 percent points and settle at around 25.5 per cent instead of estimated 29 per cent.