GUANGZHOU, China — Honor, the smartphone brand Huawei spun off last year, is beginning to regain share in China’s fiercely competitive mobile phone market.

Honor notched a 15% market share in China in August, making it the third-largest smartphone player in the country — the first time it has held that position in a year, Counterpoint Research said in a report on Wednesday.

It trails Oppo (in China) and Vivo (in India). Honor’s August sales rose 18% compared with July. This makes it the most popular brand in China.

In November, Huawei sold its budget brand Honor To a group of buyers that included the Shenzhen government, where the company’s headquarters are located.

Huawei did that to ensure Honor survived because U.S. sanctions on the Chinese technology giant cut off supplies to key components and crippled its smartphone business, which included Honor at that time. Honor was able to access key components such as semiconductors by selling it.

“After being spun off from Huawei, Honor was able to restore ties with component players,” Tarun Pathak, research director at Counterpoint Research, said in a press release. “Since then, leveraging its strong R&D [research and development] capabilities, Honor has launched new products and has been on a rapid recovery path in China.”

In January, Honor launched a mid-range phone called the V40in May, and the Honor 50 in June. The Honor 3 smartphone series, with a higher price point, was launched by Honor in China. It will also be available on other markets worldwide including Europe.

Pathak stated that Honor is targeting the premium market with its Magic series and expanding its product range across all price points.

There was also an untapped demand among loyal Huawei and Honor customers who remained with their phones and didn’t switch brands. Honor’s solid relationships with distributors helped it relaunch large-scale products. Pathak stated that Honor’s revival will intensify the competition on China’s market for H2 2021.

While Honor has its sights set on global markets, there may not be as many opportunities for success. According to Counterpoint Research research director Neil Shah, Honor’s market share in global markets grew from 1.5% in February to 3.7% in August. This is due mainly in part in China.

In international markets, Honor will face stiff competition from the likes of Apple and Samsung, as well as China’s Xiaomi, which as continued to steal the market share lost by Huawei.

Honor will have to build its distribution network and grow outside China. However, the growth is expected to be slow as there’s still low loyalty to mid-segment. Varun Maishra, Counterpoint Research’s senior analyst, stated in a release that Honor could be hindered by increasing component shortages.

Mishra was referring to the shortage of semiconductors This is currently impacting all industries, from automotive to electronics.