Apple’s stock (ticker: AAPL) surged to a new record high on Monday, capping off four consecutive days of gains. The stock closed at $193.99, marking a 1.7% increase – the largest one-day percentage gain this month. This rally comes after Morgan Stanley analysts weighed in on the potential opportunities that lie ahead for Apple in India.
In a note released on Sunday, Morgan Stanley analyst Erik Woodring, along with his team including Saurabh Mehta from the firm’s India division, reaffirmed their bullish stance on Apple by reiterating an “Overweight” rating, which is equivalent to “Buy”. Furthermore, they raised the price target to $220 from the previous $190, indicating a potential increase of more than 15.5% by July 2024.
The bright outlook from Morgan Stanley is largely derived from their estimate that India could bring in over 170 million new Apple users. They project that revenue from the Indian market will experience a compound annual growth rate of over 20%, reaching nearly $40 billion within the next decade. Comparatively, in 2022, revenue from India stood at approximately $6 billion according to undisclosed sources mentioned by Reuters and Bloomberg. Apple’s overall total revenue for the same period was an impressive $394 billion.
To arrive at these conclusions, Morgan Stanley utilized insights from their AlphaWise India Smartphone Survey, which polled more than 3,000 urban smartphone owners.
With India’s potential growth as a robust market for Apple products, investors have reason to be optimistic about the company’s future prospects.
Apple Surpasses Expectations in India as Demand for iPhones Rises
In a surprising turn of events, Apple has seen an increase in the number of people expressing their intention to purchase iPhones, thanks to the improving perception of the brand. This presents a golden opportunity for Apple to lure customers away from the Android operating system.
Even the more affordable option in the Apple lineup, the iPhone SE, falls into the premium segment of the market in India. With a price tag of approximately $600 based on current exchange rates, it has managed to capture a double-digit market share of 11% in India’s smartphone shipments last year, according to Counterpoint Research data.
Apple’s growth in the Indian market gained momentum in April when the tech giant opened its first store in Mumbai, followed by another outlet in New Delhi. Government officials have even proposed that Apple should manufacture goods worth $50 billion annually in India over the next five to six years. This initiative is part of Prime Minister Narendra Modi’s “Make in India” program, which aims to boost the manufacturing sector.
During a recent earnings call, Apple CEO Tim Cook expressed his optimism about India’s market potential. He highlighted the opportunities not only in iPhones but also in services. Cook acknowledged that the average revenue per user is relatively lower in India for services like TV and movie streaming or music. However, he believes that when considering the long term, there is immense growth potential across various sectors.
As Apple continues to thrive in India, the company remains committed to expanding its presence and exploring new avenues for growth.
