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Tim Cook, CEO of Apple Inc. Cook, right, interacts with a customer holding a Macintosh SE during the opening of the new Apple BKC Store in Mumbai, India, on Tuesday, April 18, 2023. Cook officially opened Apple Inc. The company’s first store in India, betting the iPhone maker’s retail outlets will help accelerate sales growth. Photographer: Indranil Aditya/Bloomberg via Getty Images
Indranil Aditya | bloomberg | Getty Images
India is likely to be a key driver of Apple’s revenue for five years and proven underlying growth, Morgan Stanley analysts said in a note Monday, citing Apple’s investment in manufacturing in India and the country’s “economic boom.”
The note also reflected a new price target increase driven by India, from $190 to $220, with the bull condition valuation increased to $270. Morgan Stanley also repeated apple as their best choice.
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Morgan Stanley analysts predict that over the next five years, the country could account for 15% of Apple’s revenue growth — as opposed to 2% in the past five years and $6 billion today — and 20% of the growth of the company’s installed base.
Revenue growth, projected by Morgan Stanley at $40 billion over the next 10 years, will be “the equivalent of raising Apple in an entirely new product category.”
Analysts cite a number of factors in their assessment, including India’s improved electrification and Apple’s apparent efforts to build a manufacturing and retail presence in the country. A survey conducted by Morgan Stanley suggested that Indian consumers have an increasing desire and ability to purchase iPhones.
The analysts added a caveat, warning that if India fails to meet its economic and demographic growth marks, “we don’t expect Apple to be as important in India.”
But the basic premise of Morgan Stanley is bullish. “All in all, it means that India is going to be just as important to Apple’s growth algorithm over the next 5 years or 5+ as China has been in the last 5 years, something we think the market is underappreciating today,” the analysts said.
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