The segment is growing in high single digits as consumers are increasingly trading in their older models to buy more premium handsets, they said.
Market research firm IDC India said sales will grow 8% compounded annually through 2028 to reach 26.5 million units, as consumers looking for better devices than their current ones for remote learning, work and entertainment will buy a used smartphone if they cannot afford a new device.
“As the quality of smartphone hardware improves, increasing device prices are keeping the new smartphone models out of reach of the mass segment. The aspiration to own a good device without paying much is making used smartphones a very attractive choice for consumers wanting to upgrade or even with first-time smartphone users,” IDC said in a report.
Strong demand for 5G handsets, which are sold at a premium compared to 4G devices, are also fuelling growth in demand for used phones, primarily in smaller towns and cities.”5G handsets are contributing around 75% to our refurbished smartphone sales, with strong demand from tier-2 and tier-3 cities,” said Nakul Kumar, chief operating officer of Cashify, one of the largest organised players in the refurbished segment.Counterpoint Research analyst Glen Cardoza said the refurbished smartphone market was growing the fastest in 2021 and 2022 at over 20%. The growth rate has now slowed due to a high base of users, but still the segment is expected to outpace new smartphones in sales expansion this festive season, he added.
This festive season, Cardoza said, a large number of users who purchased their first second-hand devices during the pandemic or just after would likely go for an upgrade, pushing the average selling prices up even in the refurbished smartphone market.
While the average selling prices of a refurbished smartphone, usually an old Xiaomi or a Samsung model, ranged around ₹10,000-12,000, a surge in second-hand iPhone sales is pushing prices upwards of ₹20,000.
Cashify said second-hand iPhones are going for anywhere from ₹15,000 to ₹70,000 depending on the model and their condition, with demand far outstripping supply.
The refurbished smartphone seller is expected to see volumes go up 30-50% month-on-month in November with more consumers expected to trade-in their older devices when buying a more premium handset.
“The supply situation of used smartphones has improved since last year, but demand continues to exceed supply across all price segments,” Cashify’s Kumar said.
