PC sales predicted to grow at over 15% in 2002-03: MAIT

MAIT, the apex body representing the hardware, training and R&D services sectors of the IT industry in the country, has announced the findings of its first ever Quarterly Industry Performance Review for the quarter April-June of FY2002-03. 

The Desktop PC market grossed 5.08 lakh units--63 percent of that sold in the first half of 2001-02. The market has shown signs of recovery, with sales in almost all product categories amounting to two-thirds of that sold in the last fiscal. With the buying sentiment in the market improving, PC sales in FY 2002-03 are expected to grow by 15 percent crossing 19 lakh units. Fiscal 2001-02 had recorded 1.65 million units of PC sales. 

In Q1 of 2002-03, the desktop PCs, Notebooks, Dot Matrix Printers, Laser printers have registered sales of close to 2/3rd of their sales during the first half of 2001-02. Products like Servers, Ink Jet Printers, and UPS have registered around 50 percent of the sales during H1/ 2001-02. 

Typically, the July-August-September (JAS) quarter is usually characterized by higher sales than April-May-June (AMJ), thus the sales of the IT products in H1/2002-03 is expected to comfortably exceed that in H1/ 2001-02, showing definite signs of market recovery. 

In the PC market, among the business segment it was primarily the Banks, educational institutes, Govt purchases, IT sector and IT related companies that have provided the recovery thrust to the hardware manufactures and vendors. While in the household segment, reduced prices coupled with increased selling efforts- schemes/ promotions/loans etc. have been instrumental in bringing in the recovery. Replacement demand in PCs is also expected to enhance growth in this market. Notebook sales are still largely confined to business/ establishment market and hence these segments would drive the current and future demand. The Corporate office, IT companies and financial service sector institutes have emerged as the most sought after markets for Notebooks. Households are yet to emerge as a major market. The Server market, predictably, has been restricted to the corporate segment. The corporate/office segment has not been able to reflect a significant increase in the consumption of Servers as in the case of Desktop PCs. 

Sales in H2/2001-02 were characterized by increased sales to smaller towns and cities, the same continued in Q1/2002-03. In the case of most products, sales to the smaller towns has increased and consequently the share of top four metros and next four metros have dipped. For the first time, the MAIT-IMRB Study attempted to understand the dynamics of this business and focused on issues being faced by the segment. Some of the salient recommendations from the resellers polled 

are:

The Government should focus attention on a conducive policy framework for 
IT consumption. Further, incentives for purchase of IT product and increased depreciation on IT products in the corporate sector would help boost the demand. The Government should expedite implementation of e-governance. Thirdly, major Government intervention is required in educational initiatives. The Hardware players need to focus attention to produce PC at lower costs. The market still perceives the product to be slightly above reach for immediate purchase decisions. The availability of better support & service from hardware vendors and manufacturers was also cited as a significant initiative that can better the market. 

MAIT's Industry Performance Review, ITOPs, conducted by the market research firm IMRB (Indian Market Research Bureau), is bi-annual and aims to address the hardware sector's efforts to manage the business environment, gauge the market potential and consumer trends. A new module in the study has now been introduced to monitor the Industry performance every Quarter, alternating with the half-yearly review, using the supply side estimation model involving data collection from the top IT vendors and leading channel players. The first round of the Quarterly study (April-June) involved data collation from 6 major vendors and 367 resellers/vendors across 13 metros in India. The quarterly review covers 
the market size estimation for Desktop PCs, Notebooks, Servers and Peripherals - Printers and UPS.