# Mobile Phone Retailers Anticipate 10% Price Hikes Following Diwali Retailers face declining sales and supply constraints as smartphone prices continue to rise. - **Source:** [Technology News Today, Latest Tech News | The Hindu](https://www.thehindu.com/sci-tech/technology/) - **Published:** 2026-11-05 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/17d052bd-c597-4c84-baeb-5fe444ba0978 ## Retail Market Contraction Mainstream mobile phone retailers in India are currently reporting a significant contraction in footfall and sales, ranging between 25% and 35% for value-oriented categories. This downturn occurs during the festive season, which typically serves as a peak period for consumer electronics demand, indicating a shift in broader market purchasing patterns. ## Anticipated Price Increases Major Android handset manufacturers have signaled a 10% price hike scheduled for implementation shortly after the Diwali festival. This adjustment follows a period of subdued market performance and rising operational costs, further challenging retailers who are already struggling with declining consumer interest in mass-market mobile device categories across the country. ## Severe Volume Projections The All India Mobile Retail Association projects a 50% volume drop starting after mid-November, a trend expected to persist over an extended duration. To mitigate the impact of flagging demand and severe component constraints, top smartphone brands have already reduced their production schedules by 30% to align with current market realities. ## Budget Segment Crisis The sub-20,000 rupee smartphone segment, traditionally a driver of volume sales, is currently crippled. Retailers report a lack of viable 5G handsets in this price bracket, compounded by historic price hikes and a drop in rural purchasing power. Consequently, entry-level 5G pricing is expected to shift exclusively toward the 25,000 rupee threshold. ## Reliance on Financing With device prices climbing, financing has become the primary driver of retail sales, as 80% of smartphone purchases now rely on EMI schemes. Retailers are urging brands and non-banking financial companies to introduce structured, long-tenure, zero-down-payment options to sustain demand for high-ticket devices priced above 75,000 rupees in this difficult environment. ## Global Chip Constraints Aggressive tightening in the global memory chip supply, reportedly engineered by manufacturers, underpins these consumer price hikes. This supply shortage has created a bottleneck that limits device availability and inflates costs. Retailers are now facing a market where global supply chain issues directly translate into reduced accessibility for local consumers. ## Regulatory Intervention Calls Kailash Lakhyani, president of the All India Mobile Retail Association, has urged the World Trade Organisation and global commerce ministers to establish a multilateral regulatory watchdog. The goal is to rein in artificial price manipulation within the chip sector, which retailers argue is threatening to permanently break the mobile replacement cycle. ## Long-term Market Outlook Without urgent intervention to address rising costs and supply chain manipulation, consumers may be forced to hold onto their existing phones for extended multi-year periods. This shift in consumer behavior could fundamentally alter the mobile retail landscape, moving away from frequent replacement cycles toward a more stagnant, cost-sensitive replacement model. ## Sources covering this story - https://www.thehindu.com/sci-tech/technology/mobile-phone-retailers-expect-10-price-hike-post-diwali-even-as-sales-drop/article71668987.ece — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._