MAIT study indicates 23% decline in PC sale

BANGALORE: The IMRB conducted MAIT’s Industry Performance Review for the

first-half of 2001-02 has revealed a decline of four per cent in desk top PC

sales, against the same period last year and a decline of 23 per cent compared

to the second-half of 2000-01.

PC sales had registered a growth of 34 per cent in the FY 2000-01 over that

of 1999-2000. "The severe recessionary trend in the Indian economy has

adversely impacted the hardware market and based on the poor buying sentiment in

the market, the sales projection for FY 2001-02 has been revised from 2.45

million units to 1.65 million units," stated the survey.

The Assembled PCs has accounted for 44 per cent of the PC sales in 2001-02, a

negative growth of 28 per cent, compared to the same period last year. The poor

performance in the assembled market has resulted in the southward growth of the

entire PC market, reflecting the fact that price sensitive market segments

deferred their IT purchase plans in the first half of 2001-02. However, the MNC

brands maintained a robust performance, a market share of 36 per cent, up from

24 per cent in the first half of 2000-01, registering a growth of 44 per cent.

The Indian brands accounted for 20 per cent of the market. The share of the

Indian brands in H1/2000-01 was 17 per cent.

The review also reveals that PC sales to the business segment declined by 1.5

per cent while to the households it declined by 11 per cent as compared to the

sales in the first-half of the last year. The business segment continued to

account for 78 per cent of the market. The market witnessed significant

slow-down in IT consumption in the general manufacturing, banking & finance

and media & professional services sectors.

In terms of the Processor configuration, PC sales in H1/ 2001-02 were

dominated by P-III 550 MHz, which accounted for 47 percent of the market share,

followed by P4 accounting for another 19 percent. H2/2000-01 had marked the

entry of P4 processors and P4 had then accounted for only 4 percent of the

market share.

Printer sales, according to MAIT-IMRB estimates, dropped by 18 percent

compared to that in H1/2000-01. Sales of Dot-matrix fell by 3 percent; Laser

printers by 21 percent and Inkjet printers by 32 percent. Dot-matrix printers

accounted for 54 percent of the market share, Inkjet printers for 37 percent and

Laser printers for 9 percent.

Some of the findings of the survey



Overall the PC purchases in the metros accounted for 53 percent of the total
PCs purchased, representing a decline in purchases by 18 percent.

The Server market declined by 6 percent in the first half of 2001-02 over the

first half of 2000-01. Consumption of servers in the Larger Businesses grew by

42 percent and they accounted for 58 percent of the server sales. Server sales

in small and medium enterprises sharply declined by 29percent and 40percent

respectively.

The number of active Internet subscribers increased to 1.23 million in

September 2001 indicating an increase of just 10 percent over March 2001. The

penetration of Internet among businesses has remained stagnant at 36percent and

showed a marginal increase of 1percent among households to reach 10 percent.

MAIT director, Vinnie Mehta, said, "Though the entire country is

witnessing an economic slowdown, the IT market is expected to bounce back in the

later part of the second half of 2001-02. The industry and the market need a

shot in the arm - There is a pressing need to bring down the prices of IT

products to proliferate IT to the grassroots level. MAIT has recommended

bringing down all local levies - Excise duty and sales tax to this effect."

He further added " The performance of the industry will get a further boost

by increased IT consumption in the Government. While most Government Departments

- Centre and State have earmarked 2-3 percent of their annual budgets for IT

spends, we are yet to witness that spend happen. The initiatives launched by

various State-Governments for e-governance are encouraging, but need to gather

momentum."