Fall in rupee might lead to increased price of mobile phones, especially the entry-level variant.
In a recent report, PTI has stated that handset makers are strongly of the opinion that as a result of the recent downfall in rupee, the price of mobile phones, specially the entry level models could spike up in the coming days.
Industry reacts negatively
Looking at the market scenario at the moment, with the increase of dollar, Intex Technologies (India) Director Nidhi Markanday believes that the situation is expected to worsen further. As a result, she thinks that the cost incurred in mobile handsets will increase and will therefor lead to an overall hike in the final cost of the handsets.
Sanjay Kalirona, CEO and Director of COMIO India, said to PTI that the Indian mobile handset industry is already under tremendous pressure with the increase in cost of raw material and custom duty.
Kalirona further pointed out that Indian handset makers are currently operating on very thin margin. With the strengthening of the dollar versus rupee, the pressure on bottom line has further increased, according to him. COMIO is reviewing the impact of the situation and will take a decision on pricing post that.
On the other hand India Cellular and Electronics Association Chairman Pankaj Mohindroo stated that there has been some cushioning because of negligible CBU (completely built units) import into India as significant value addition is being done locally.
Continuing its slide, the rupee today slumped 43 paise again the dollar to trade at an all-time low of 70.32 on strong demand for the US currency.