New Delhi: Sales of personal computers (PCs) in India expanded more than a quarter in fiscal 2007, driven by growing incomes and declining prices, to a record 6.3 million units, placing the industry on track to top 10 million in sales by March 2009.
Some 5.4 million desktop computers and 850,000 notebook units were sold in the country in 2006-07, industry body Manufacturers’ Association for Information Technology (Mait) said. In revenue terms, the world’s fastest growing market for information technology products sold around Rs14,260 crore worth of PCs in 2006-07.
Mait predicted that the domestic PC market is estimated to touch 8 million units in fiscal 2007-08, with desktops expected to sell 6.2 million units. The strong growth in sales of notebook computers—97%— in the fiscal year gone by is expected to continue this financial year and next, and ratchet up sales of such portable computers to more than 2 million by March 2009.
Computer purchases in fiscal 2007 was split 76%-24% between business and home buyers.
“We need a much more vibrant home market that is price sensitive. Strong infrastructure, reliable power resources and broadband penetration is what can make India more tech-savvy,” said Mukul Singhal, the current president of Mait and managing director of Lipi Data Systems Ltd, a computer peripherals maker.
An analyst said sales would ramp up only if PCs sales took off in smaller cities and towns. “India is still a very under-penetrated market. Main growth will happen only when smaller income groups from tier II and tier III cities begin to buy hardware and software,” said Diptarup Chakraborti, principal analyst at research firm Gartner Inc.’s Mumbai office. Gartner has projected the Indian PC market— both desktop and laptop segments—will grow to 9.8 million in the year to December 2007.
The growth in PC sales will be driven by purchases by small enterprises—defined as businesses employing less than 99 people—which have now begun investing heavily in IT. Besides, the replacement cycle of IT products, which used to be four years until mid-2006, has now shrunk to a little more than 3.5 years due to changing technology and growing demand.
“As and when a market matures, the replacement cycle shrinks and India is fast becoming a maturing market, where the replacement cycle will be three years,” Chakraborti said.
Hewlett-Packard India, HCL Infosystems and Lenovo India are the top three computer vendors in the country, ranked by number of PCs sold, followed by Dell, Acer, LG, PCS, Sahara Computers, Wipro and Zenith. Mait on Thursday did not confirm this ranking.