Year 2001-disappointing yet okay

DQW Bureau
New Update


The year gone by has been a year to be remembered; veterans have dubbed it as a shake out year-when stronger players stood the test of time and not so stronger lost it. And weaker ones have completely vanished from the scene.

IT industry saw its worst performance, with sales touching rock bottom, software industry slowed to the last gear, hardware industry was also showing its signs of jarring. The IT industry saw the greatest number of pink slips ever, with a number of vendors laying off their employees in the name of cost cutting/corporate clean-up/right sizing.


The IT hub of India-Nehru Place-had its own story to tell. A spate of scams thronged the entire market in the past one year with a booty close to Rs 5 crore. All the vendors had their own fight to push their sales with lucrative schemes in market and aggressive marketing strategies in place. The channel partners also saw very different activities during the last three quarters.

Various channel partners re-engineered and re-aligned their business practices. The market sentiments touched their rock bottom a fortnight before Diwali. November came with buoyancy in the general market, but sales were yet to take off. Last three quarters have seen a total market dip of close to 35 to 40 percent. The software industry saw a steep dip, hardware sector had a serious setback and other peripherals such as printers and speakers were hit equally.

When feedback was taken from the industry, the coming quarter seems to bring back the same optimistic mode and bearish activities. The JFM quarter as per them, should bring back escalated sales, improved inventory levels and serious business in the market. Though some players are cautious and apprehensive about new tax policy-Value Added Tax (VAT)-and the new budget (custom duties are expected to see some changes).


As the DQW News Bureau spoke to the channel partners, this is what they observed.

Anil Gupta, Director, Artek Enterprises: We were expecting 20 percent growth, but this recent downturn has made our total revenues down. Market as a whole has seen a drop of 40 to 50 percent. Coming times will be very crucial as credits will settle and cash flows will ease out. New budget will also be crucial.

Sunil Gupta, Director, Challanger Computers: The company saw a dip of more than 25 percent at whole. The coming quarter will bring a lot of hope as in the past few days, market has been responding very optimistically. Market sentiments are already good and this should bring those expected and much awaited good results. If this sentiment prevails, market is sure to pickup.


Daljeet Singh, Director, Compro Computers: There has been a decline of approximately 20 percent. HP printers have seen a downslide. Wipro and Canon have performed well in the market. However, the market should pick up well in the coming quarter as we have seen the worst.

Sunil Narang, Director, Elcom Trading: Our business saw a dip of 50 percent. The market as whole has been very bad. September was the last nail in coffin, with the recent happenings things can turn dubious. We are hoping that the next quarter should bring some hope and better sales.

Akhilesh Gupta, Marketing Manager, Fortune Marketing: Last year was of course better than this one. But for us even this was relatively good, as we changed our business line about five months back. Two months I can recall that were really bad were April and May. But business picked up really well after Diwali. As we have discontinued the usual stocking of motherboards, hard disks and CPUs, the multimedia product range that Fortune now stocks and specializes in, have done really well. If we talk of volumes, surely there is nothing considerable about it, but since margins are good, so at the end of the day we have considerable revenue to look up to.


Sanjeev Bhavnani, Director, Infotecnics India: As a niche player, the telecom and banking sector has bailed out our performance, but the dent is apparent. The coming quarter will be good; as banking sector will see a lot of buying. On the whole, we all can hope for new sunshine.

Anil Sachdeva, Director, Kadam Marketing: We have been able to manage endurable sales through stringent measures and matching the price points. But market has seen the worst this year. The coming quarter should bring in higher cash flows as sales will pick up and the financial year will end. The government sector should bring in the greatest business. Though a lot of players will practice restraint as the new budget will be out and VAT will be implemented.

Rajesh Aggarwal, Director, Micromax Technologies: The market has been bad and we are not immune to the market sentiments. Sales have dipped considerably. But the market should pickup in the coming quarter and bring normal conditions back. This will be a crucial quarter as government buying is expected to increase considerably.


Ankur Bansal, Director, Pulse System: The market went spiraling down. Each and every sector of IT industry has seen it getting from bad to worse. Our company had a setback of close to 50 percent as compared to the last year's revenue figures.

The coming quarter should bring back better sentiments as the new budget will be in place and fiscal year end will bring a lot of buying.

Bharat Bhushan, Director, RR Systems: Looking at the past three-quarters, the worst months I can recall were April,

May and September--three months when I didn't hear even a single case of a happy dealer. Reasons were many. In April, there were no MNC purchases, in May there were no retails and even MNCs were bad, and September was bad since beginning and then ultimately it touched the lowest. Compared to last year, this year our business was down by about 20 to 25 percent. But I am hopeful about the next quarter at least--if I should be modest--because market has been (according to the present terms), extremely well in past 10-15 days.

Harsh Vij, Director, SD Computers: Well, we have not been able to perform really brightly in the last three quarters; we had a dip of about 35 percent in our sales. This major shakeout has left a lot of players out of business. A lot of them have diversified--whether the channels, the OEMs or other local players. The time ahead will prove how strong Indian IT market is. Implementation of VAT and government buying will be very crucial in the next year.