KOLKATA: Chinese smartphone maker Xiaomi has become the No 1 smartphone brand in the Indian market in the quarter ended December 2017, surpassing Samsung which was till the previous quarter leading by a small margin.According to data from Singapore-based research firm Canalys , Xiaomi clocked a 27.4% share of the market with 8.2 million phones, higher than Samsung’s 24.6% share on the back of more than 7.3 million phones in the three month period. Hong Kong-based Counterpoint Research also reported a similar trend with Xiaomi holding 25% of the market, ahead of Samsung which had a 23% share in the quarter ended December.“Xiaomi’s persistence has paid off,” said Ishan Dutt, research analyst at Canalys. “Multiple factors have contributed to Xiaomi’s growth, but the key reason for its current success lies in the autonomy that it granted its Indian unit, letting it run the business locally,” he said, adding that localization in channel strategy, marketing and products was evident in Xiaomi’s Indian operations."Xiaomi disrupted the status quo with an aggressive priced broader portfolio with effective channel expansion strategy," added Tarun Pathak, associate director at Counterpoint Research, adding that the Chinese firm upstaged the market leader's for the first time in a quarter, in six years.As of September end, the agency, along with Cybermedia Research (CMR) and Counterpoint Research put Samsung as the market leader in smartphones, with Xiaomi behind by just 0.5 percentage point to 1 percentage point share. International Data Corporation (IDC) India data, however, said both Xiaomi and Samsung had a 23.5% share. IDC and CMR are expected to announce their numbers early next month.Xiaomi’s success in India will have far-reaching implications for its worldwide strategy, giving a big boost to its overseas ambitions, Canalys analysts added, indicating to Xiaomi’s plans of doing a IPO this year which may value the company at $100 billion. “Considerable business in the world’s largest two smartphone markets will build confidence in its partners as well as future investors.”Samsung contested Canalys' data and asserted that it still lead the market by a distance and had a strong holding both by value and volumes.“As per GfK, which tracks sales to end consumers, in the last (November) quarter Samsung had a 45% value market share and 40% volume market share. Samsung is a full range player and leads the smartphone business across every segment of the India market in 2017," the company said in a statement Wednesday evening.India’s smartphone market grew by a modest 6% to about 30 million units, following the seasonal dip as vendors and channel partners take stock after a busy September quarter, analysts at Canalys said, adding that it was in line with their forecasts. Vivo, Oppo and Lenovo took up the No 3 to 5 ranks in that order, with 7.8%, 7.1% and 6.9% shares, respectively. Counterpoint Research said all the three brands had a 6% share of the market, but ranked them in the order of Lenovo-Motorola, Vivo and Oppo.The results come at a time when Samsung has lost its top spot in the featurephone segment as well, to Reliance Retail’s JioPhone that shipped more than 15 million devices in the December ended quarter. While it increased its share in the smartphone space on-quarter, from 23.1% to 24.6%, it failed to strengthen its low-cost portfolio, which was Xiaomi’s stronghold.“Samsung has been unable to win over cost-conscious consumers, losing market share in the sub-Rs 15,000 (US$240) segment to Xiaomi quarter after quarter,” said Canalys analyst Rushabh Doshi.Despite its ability to offer better margins and funding to the offline channel, consumer demand for Samsung’s devices has been weak, he added.The power struggle between Xiaomi and Samsung will continue well into 2018, as Samsung revamps its low-cost portfolio and fights to take back the aspirational status it once held in minds of Indian consumers. The company’s far superior R&D, and a better hold on the supply chain due to its strong components business will also come into play.“But growth in 2018 will be hard to come by for Xiaomi,” said Doshi, adding that Xiaomi’s market share would reach saturation point in India and hence slow down, even as market continues to shrink in China. Therefore, it should prepare for slower growth for its smartphone business while it begins to expand in other countries.