Hardware looks forward to 40% rise in AMJ

DQW Bureau
New Update


After almost 30 percent drop in sales in JFM quarter, partners in the garden city are looking for a growth of 40 percent in AMJ. According to several channel partners, factors that will play a major role in accelerating the sales for second quarter of this calendar year would be major IT investments expected from the telecom industry and service providers.

According to market sources, government is also planning to focus on IT deployment in larger scale. On the other hand, after many dotcoms going bust, the market is now seeing many call centers coming up, which is expected to scale up hardware sales during the next two quarters. The partners expect some growth also from the SOHO segment, as vendors are refocusing on end-user campaigns to develop a pull factor for their products.

"The market has just slowed down, we will have to stimulate it and this is the time, when we have to support our channels and motivate them to perform better," says MB Sam, Country Marketing Manager, Consumer Business Organization, Hewlett-Packard India Ltd.


Connoisseur Electronics, a Bangalore-based distributor claims to have closed the first quarter with a 60 percent downfall in sales, while Tovya Automations had recorded a drop of about 30 percent. Kobian on the other hand had seen a dip of 30 percent in sales during the first quarter. 

With the second quarter still on the horizon, several channels foresee a growth of 40-50 percent over the last quarter, though they are predicting a total stability of both hardware prices and its availability only by September this year.

According to channel partners, the second quarter seems to be promising as they are expecting the sales to pick-up and prices of hardware products to stabilize. 


"Though there is no signs of further investments from the vendors in the market, I still feel that the second quarter will show traces of improvements in terms of sales towards the end. But certainly, the beginning of the second quarter is going to be equally tough and will replicate JFM sales to a certain extent," says Jagdish S Varma, MD, Connoisseur Electronics Pvt Ltd. 

Reportedly, the IT hardware industry on the whole is witnessing a sluggish period since November 2000 and the much happening JFM quarter was hard hit with merger sales recorded in the books. 

The entire IT hardware industry saw a recession and several factors attributed to the slowdown. "The true slowdown came during mid-February with the unchanged budget and crash of the Bombay Stock Exchange. Both these factors affected the national economy and the hardware industry to a large extent," said Sam. 


While several others foresee a further dip in the figures. "Most of the vendors are putting a procurement freeze. The first half of the second quarter will still show patterns of market slump, though we are not too sure about the closing," says CT Raj, Director, Tovya Automations Controls.

Though channels in Bangalore are optimistic about a better quarter against JFM, it might be just too early to know the reality.