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Apple (AAPL) Continues to Increase its Focus on India
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Citing sources familiar with the matter, The Wall Street Journal reported that the incentives “sought” by Apple Inc. (AAPL - Free Report) to set up manufacturing facilities in India are likely to be reviewed by the Indian government next week.
Since the last year, Apple has been increasing its focus on India to claim a greater share of the vast smartphone market, of which it reportedly holds only 5% as of now. Apple faces slowing iPhone demand in most of the regions, either because of competition or regulatory hurdles (China) or market saturation (the U.S). Therefore, it makes sense for the company to solidify its position in a developing nation like India, which is projected to become the second largest smartphone market in the world. In fiscal 2016, Apple sales in India grew approximately 50% over the prior fiscal.
Furthermore, a younger (and skilled) population and increasing investment in broadband network by the government also make India an attractive growth opportunity for Apple over the long run. In fact, the Indian government under PM Narendra Modi is eager on bringing foreign capital and boost manufacturing facilities in India.
Apple CEO Tim Cook was on his maiden visit to the country earlier this year. He met Modi and announced the opening of an iOS App Design and Development Accelerator in Bengaluru and a map development office in another southern Indian city, Hyderabad in collaboration with regional firm RMSI. The company also has partnered with telecom company Reliance, which is providing its Jio (a unique all-IP network) service for free with the new iPhones.
Per media reports, the recently outlined FDI policy also bodes well for the company as it eliminates the requirement to locally source products for at least a three-year period. This will enable Apple to open its solely-owned retails stores in India. Thereafter, the company will have to comply with the rule.
However, the market is cost sensitive and Apple will have to fight it out vigorously with dominant players like Samsung, which sell handsets running on Alphabet’s (GOOGL - Free Report) Android system.
Apple, of course, is not the only tech player eyeing India for growth. Given the potential of this market, Silicon Valley’s interest is well understood. From Microsoft Corp. (MSFT - Free Report) to Alphabet to Facebook Inc. all remain laser focused on the Indian market.
Year to date, shares of Apple have registered growth of 10.90% compared with the Zacks Computer Mini industry’s gain of 11.96%.
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Apple (AAPL) Continues to Increase its Focus on India
Citing sources familiar with the matter, The Wall Street Journal reported that the incentives “sought” by Apple Inc. (AAPL - Free Report) to set up manufacturing facilities in India are likely to be reviewed by the Indian government next week.
Since the last year, Apple has been increasing its focus on India to claim a greater share of the vast smartphone market, of which it reportedly holds only 5% as of now. Apple faces slowing iPhone demand in most of the regions, either because of competition or regulatory hurdles (China) or market saturation (the U.S). Therefore, it makes sense for the company to solidify its position in a developing nation like India, which is projected to become the second largest smartphone market in the world. In fiscal 2016, Apple sales in India grew approximately 50% over the prior fiscal.
Furthermore, a younger (and skilled) population and increasing investment in broadband network by the government also make India an attractive growth opportunity for Apple over the long run. In fact, the Indian government under PM Narendra Modi is eager on bringing foreign capital and boost manufacturing facilities in India.
APPLE INC Price
APPLE INC Price | APPLE INC Quote
Apple CEO Tim Cook was on his maiden visit to the country earlier this year. He met Modi and announced the opening of an iOS App Design and Development Accelerator in Bengaluru and a map development office in another southern Indian city, Hyderabad in collaboration with regional firm RMSI. The company also has partnered with telecom company Reliance, which is providing its Jio (a unique all-IP network) service for free with the new iPhones.
Per media reports, the recently outlined FDI policy also bodes well for the company as it eliminates the requirement to locally source products for at least a three-year period. This will enable Apple to open its solely-owned retails stores in India. Thereafter, the company will have to comply with the rule.
However, the market is cost sensitive and Apple will have to fight it out vigorously with dominant players like Samsung, which sell handsets running on Alphabet’s (GOOGL - Free Report) Android system.
Apple, of course, is not the only tech player eyeing India for growth. Given the potential of this market, Silicon Valley’s interest is well understood. From Microsoft Corp. (MSFT - Free Report) to Alphabet to Facebook Inc. all remain laser focused on the Indian market.
At present, Apple has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Year to date, shares of Apple have registered growth of 10.90% compared with the Zacks Computer Mini industry’s gain of 11.96%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>