IT market to grow at 18 percent in FY 2003-04

The buoyant IT consumption witnessed in FY 2002-03 continued undiminished in Q1 2003-04. With robust growth prospects, the IT market is expected to grow at 18 percent in FY 2003-04 over that in the last fiscal year, while the PC sales are expected to cross 27 lakh (2.7 million) units. 

These were some of the findings of the MAIT Quarterly Industry Performance Review for the quarter April-June of FY2003-04, conducted by market research firm IMRB (Indian Market Research Bureau).

According to the survey, the desktop PC market grossed 6.4 lakh units in Q1/2003-04 - a growth of 26 percent over Q1/2002-03. The sales in the Q1 of FY 203-04 are expected to cross 14.2 lakh units. The earlier projection of 12.1 lakh units in sales for H1/2003-04 has been revised upwards in light of the buoyant business sentiment in the market.

The increased consumption of IT products witnessed in FY 2002-03 in smaller towns and cities continued unabated in Q1 of 2003-04. Smaller towns accounted for 37 percent of the total PC sales while the Top four cities accounted for 46 percent and the next four for 17 percent.

Similarly smaller towns accounted for 17 percent of notebook; 52 percent of dot-matrix printer; 31 percent of inkjet printer; 19 percent of laser printer and 30 percent of UPS sales.

As per the MAIT-IMRB study, the assembled PCs - the smaller lesser known regional brands and unbranded systems, acco-unted for 65 percent of the PC sales in Q1/2003-04. The pro-portion of the assembled PC had risen significantly to 63 percent in Q3 (OND)/2002-03, however this was checked by increased consumption in the corporate from the organized sector in Q4 (JFM), more than neutralizing the impact and bringing the annual market share of assembled PCs to 46 percent.

But once again in Q1 2003-04 the assembled PC market managed to garner a significant market. MNC brands accounted for 19 percent of the market while the Indian brands acco-unted for the rest 16 percent.

According to the survey, the growth in PC sales can be lar-gely attributed to increased IT consumption by Industry verti-cals and corporate sectors such as telecom, banking & financial services, manufacturing and IT-enabled services.

Apart from these traditional sectors, higher consumption was also witnessed in SMEs, IT training institutes and compu-ter centric small enterprises. Growing number of retail outlets and malls have also added to the PC consumption. According to the survey, major e-governance and digital divide initiatives of the central and state governments are also driving IT consumption in the country.

In addition, the trend of inc-reased PC purchase in smaller towns and cities, witnessed last year, continued steadfast.

Aggressive pricing by the PC vendors has also helped imp-rove the PC penetration, espe-cially, in the households and the SME segments.

Vinnie Mehta, Executive Director, MAIT, said, “To ensure that IT reaches grass root levels in India, there is a pressing need to bring down the prices of IT products. MAIT has recom-mended bringing down all local levies especially the excise duty from existing 16 percent to eight percent. Should that happen, the domestic market can grow comfortably by 50 percent pa for the next few years. Lower domestic taxes will also enable the organized sector to offer prices compara-ble to the unorganized sector.”

Cyber News Service