Samsung's recall of its Note 7 smartphones and the subsequent production halt is likely to hit the company’s revenue in India by about Rs.6,500 crore, according to research firm CMR.
CMR said that as per its impact analysis, the Korean electronics major may fall short of its shipment target for 2016 by four million units due to the Note 7 battery issue that led to discontinuation of the model’s sales.
“This translates to Rs.6,457 crore in terms of revenue for the company. As per projected growth, Samsung was expected to touch revenues of Rs.45,446 crore in CY2016, an increase of 46 per cent compared to the previous calendar year,” according to a report by CMR.
However, following the Note 7 issue, it can earn revenues of Rs.38,989 crore, which means a growth of 25 per cent in revenues in 2016, it added. As per CMR, Samsung will continue to maintain leadership in the smartphone segment in India. However, the company’s market share is likely to shrink by 4.2 percentage points and settle at abut 25.5 per cent instead of an estimated 29.7 per cent. “Though Note 7 is a high-end premium smartphone, the impact would be on Samsung spanning across all the segments,” Faisal Kawoosa, Principal Analyst for Telecoms at CMR said.
