Apple Stock News
With 1.3 billion people and 220 million smartphone users, Apple sees a lot of opportunity in the India, which is the world’s fastest growing economy. Apple currently holds a mere 2% of the Indian smartphone market according to Counterpoint Research. On Wednesday, January 20th Apple announced that they filed a request with the Indian government to bring its own retail stores to the country. Apple products are currently made available in India through resellers such as Redington, Apple’s main distributor.
In India, the government has a rule that states that foreign companies who want to sell a single brand have to procure 30% of inputs locally, however, Apple is looking for an exemption to that rule because they sell cutting edge technology. Despite Indian Prime Minister Narendra Modi’s attempts to open up the Indian economy to forgein investment, The World Bank still ranks the country a difficult place to do business.
Furthermore, today, Apple announced that they will be opening their first offshore technology development center in Hyderabad. The new center will cost about $25 million and will be built on 250,000 square feet of land. Although, there is no mention as to whether the facility is an attempt to facilitate the permit process for Apple to open up stores, it is being received very positively by the local community as it is expected to create around 4,500 jobs.
A big challenge for Apple in India is the fact the Indian consumers prefer cheaper devices. Tarun Pathak, a senior analyst at Counterpoint Technology Market Research told Bloomberg “Most of the growth in India will come from new users coming into the Apple ecosystem, unlike in the West where growth is mainly from existing users upgrading.” Pathak further believes that Apple’s strategy in India will involve lowering the prices of older model phones, such as the iPhone 5s, in order to bring Indian customers into the Apple ecosystem.