Apple’s India business tops $23 billion as manufacturing growth hits 50-year high

New Delhi: A surge in iPhone Domestic manufacturing and sales of MacBooks, iMacs, iPads, Watches and AirPods pushed the value of Apple’s India operations to over Rs 2 trillion ($23.5 billion) in FY24, senior officials said, up from Rs 1.15 trillion a year earlier. They told ET that Apple Apple has probably shown the fastest growth in production and exports of any company in the last 50 years in India, making the Cupertino-based tech giant the largest global value chain (GVC) operating domestically. Apple is also the first GVC in India to rapidly shift part of its supply chain from China.

According to the recent Economic Survey, India contributes around 14% to the total output of the American tech giant, emerging as a key hub for its global exportsIn FY23, India’s contribution was around 7%. iPhones Numbers dominate. Of the 2 trillion rupees valued at 1.35 trillion rupees ($15 billion), iPhones with a market value of around 2 trillion rupees ($15 billion) were exported last fiscal year, calculations based on official data show.

PLI Boost

According to estimates, domestic sales of Apple products brought in around Rs 68 billion ($8 billion) in fiscal 2024. In comparison, Apple exported iPhones with a market value of Rs 66 billion in fiscal 2023.

Apple’s share in India is less than 6%, though it is rising steadily from 2% in fiscal 2018, as the market is largely dominated by the Android ecosystem, led by Chinese brands such as Alive and XiaomiMoreover, India’s revenue contributed less than 2% of the company’s global revenue of $383 billion in fiscal 2023. Apple follows an October-September fiscal year. Its fiscal 2024 figures will be announced in October.

While Apple has been operating a sales and distribution business in India for several years, the acceleration of its operations came about since 2020, when the government announced the smartphone production-linked incentive (PLI) scheme.

Apple began manufacturing iPhones in India in 2021, the first time it had done so outside China. Since then, iPhone production in India has been steadily increasing across its three contract manufacturers (Foxconn, Wistron, and Pegatron), reaching Rs 1.2 trillion by fiscal 2024. Tata acquired Wistron’s India facility late last year. The government pays incentives on the freight on board (FOB) value at which the device leaves the factory. The market value or retail prices are 50-60% higher.

By market value, Apple produced iPhones worth Rs 1.80 lakh crore in FY24. Of the total production, 75% of iPhones with a market value of nearly Rs 1.35 lakh crore were exported to Europe, the US, West Asia and elsewhere, while local sales accounted for the remaining Rs 45,000 crore. Experts said local manufacturing of iPhones has helped Apple expand sales in India, not just for iPhones but also for its product range. Apple’s revenue in India reached Rs 68,000 crore in FY24, five times more than Rs 13,756 crore in FY20. That includes MacBooks, iMacs, iPads, Apple Watches, AirPods and other accessories.

Sudden increase in shipments

Export figures are not counted in India’s revenue, but Apple’s manufacturing ecosystem surge has created more than 150,000 direct jobs since 2021. Foxconn operates Apple’s largest factory in the country, employing 41,000 people. Apple CEO Tim Cook told analysts on its third-quarter earnings call in August that the company had set “quarterly revenue records in more than two dozen countries and regions, including Canada, Mexico, France, Germany, the U.K., India, Indonesia, the Philippines and Thailand.”

Apple’s performance comes as smartphone shipments in India fell 2% year-on-year in the June quarter, according to market tracker Counterpoint Research, which attributed the decline to the heatwave, a seasonal slump and a sequential slowdown in demand from the previous quarter. Highlighting the importance of India amid the current geopolitical situation, Cook visited India in April last year to meet Prime Minister Narendra Modi and launch the first two company-owned retail stores in Delhi and Mumbai.

On the May earnings call, he said that “the company was working on everything from developers to markets to operations in India. I see it as an incredibly exciting market and an important focus for us.”