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Apple to Benefit from India's New Used Goods Import Policy
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Apple’s (AAPL - Free Report) interest in India recently got a major boost after the country’s government allowed import of used goods for repair and refurbishment of electronic devices.
Per Reuters, Indian government will allow import on condition that the refurbished devices should be exported and the “waste generated during the repair and refurbishing of the imported items to be treated in line with local laws including health, safety and environment norms.”
India’s new import policy is expected to benefit Apple in two ways. The iPhone-maker assembles, repairs, and refurbishes most of its devices in China, where it is already facing rising manufacturing as well as labor costs. Apple is likely take advantage from the new policy by shifting more manufacturing to India, thereby lowering costs.
Moreover, Apple will be able to avoid some negative impact from the escalating trade war between the United States and China. President Trump has already imposed import tariffs of almost $60 billion on Chinese goods. China is likely to retaliate by imposing additional duties of up to $3 billion of U.S. imports.
Apple shares were up 0.88% in pre-market trading on Mar 29. The stock has returned 15.6% in the past year, much better than 10.4% gain of S&P 500.
India: An Important Market for Apple
Apple considers India to be an important growth market for its devices, with iPhone being the primary growth driver. According to a latest report from CyberMedia Research, by the end of 2018, India will have more than 10 million iPhone users, which is a significant achievement, considering the price-sensitive nature of the market.
Apple has only 2-3% of India’s smartphone market share, but dominates the premium segment (smartphones priced greater than Rs. 30,000). However, per Counterpoint Research estimates, Apple has lost market share in this segment to Samsung and OnePlus. This doesn’t bode well for the company’s future in the world’s second-largest smartphone market.
Apple currently assembles only iPhone SE in India through its Taiwanese contract manufacturer Wistron. Reportedly, a unit of Winstron recently won approval from the state of Karnataka to build a new assembly facility, indicating a potential expansion of assembly work in India.
Notably, Apple has been in active discussion with the government for tax breaks and incentives, which, however it has failed to gain, so far. Hence, the new import policy is definitely encouraging for Apple.
Long term earnings growth rate for HP, NVIDIA and Paycom is currently pegged at 5.96%, 10.25% and 25.75%, respectively.
Investor Alert: Breakthroughs Pending
A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.
Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.
Image: Bigstock
Apple to Benefit from India's New Used Goods Import Policy
Apple’s (AAPL - Free Report) interest in India recently got a major boost after the country’s government allowed import of used goods for repair and refurbishment of electronic devices.
Per Reuters, Indian government will allow import on condition that the refurbished devices should be exported and the “waste generated during the repair and refurbishing of the imported items to be treated in line with local laws including health, safety and environment norms.”
India’s new import policy is expected to benefit Apple in two ways. The iPhone-maker assembles, repairs, and refurbishes most of its devices in China, where it is already facing rising manufacturing as well as labor costs. Apple is likely take advantage from the new policy by shifting more manufacturing to India, thereby lowering costs.
Moreover, Apple will be able to avoid some negative impact from the escalating trade war between the United States and China. President Trump has already imposed import tariffs of almost $60 billion on Chinese goods. China is likely to retaliate by imposing additional duties of up to $3 billion of U.S. imports.
Apple shares were up 0.88% in pre-market trading on Mar 29. The stock has returned 15.6% in the past year, much better than 10.4% gain of S&P 500.
India: An Important Market for Apple
Apple considers India to be an important growth market for its devices, with iPhone being the primary growth driver. According to a latest report from CyberMedia Research, by the end of 2018, India will have more than 10 million iPhone users, which is a significant achievement, considering the price-sensitive nature of the market.
Apple has only 2-3% of India’s smartphone market share, but dominates the premium segment (smartphones priced greater than Rs. 30,000). However, per Counterpoint Research estimates, Apple has lost market share in this segment to Samsung and OnePlus. This doesn’t bode well for the company’s future in the world’s second-largest smartphone market.
Apple currently assembles only iPhone SE in India through its Taiwanese contract manufacturer Wistron. Reportedly, a unit of Winstron recently won approval from the state of Karnataka to build a new assembly facility, indicating a potential expansion of assembly work in India.
Notably, Apple has been in active discussion with the government for tax breaks and incentives, which, however it has failed to gain, so far. Hence, the new import policy is definitely encouraging for Apple.
Zacks Rank & Stocks to Consider
Currently, Apple has a Zacks Rank #3 (Hold).
HP (HPQ - Free Report) , NVIDIA (NVDA - Free Report) and Paycom (PAYC - Free Report) are some of the better-ranked stocks worth considering in the broader technology sector. All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long term earnings growth rate for HP, NVIDIA and Paycom is currently pegged at 5.96%, 10.25% and 25.75%, respectively.
Investor Alert: Breakthroughs Pending
A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.
Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.
Click here to see them >>