2013-11-02 09:13:30 - New Computer Technology research report from Business Monitor International is now available from Fast Market Research
India's IT market continues to have a bright outlook over the medium term, making it one of the leading emerging markets. We forecast Indian IT spending will increase 14.4% to INR1,077bn in 2013, with strong growth in hardware, software and services sales. Hardware is a particularly large opportunity, with regionally low PC penetration, declining device costs, rising incomes and government procurement initiatives combining to provide an engine for sales growth. However, it is IT services that will be the outperformer in terms of growth rates, as has been the case traditionally in India's IT market. Outsourcing firms are innovating and acquiring to expand product portfolios and generate non-linear growth, which should sustain the segment as a whole despite competition from
other low-cost locations.
Full Report Details at
- www.fastmr.com/prod/698083_india_information_technology_report_q ..
Headline Expenditure Projections
* Computer Hardware Sales: INR457.3bn in 2012 to INR526.7bn in 2013, +15.2% in local currency terms. The wider availability of low-cost tablets and laptops, rising incomes, increasing connectivity and government procurement for education are key drivers behind spending growth..
* Software Sales: INR106bn in 2012 to INR112bn in 2013, +5.7% in local currency terms. Solid but unspectacular uptake of Windows 8 and continued high prevalence of piracy mean growth is underperforming its potential.
* IT Services Sales: INR379bn in 2012 to INR438bn in 2013, +15.8% in local currency terms. Large projects are expected from the government, including its push to developing a private government cloud, as well as from other key verticals that are implementing cloud solutions. The outsourcing market will remain strong as vendors transition to non-linear growth strategies in the face of global competition.
India's score is 48.6 out of 100.0 and is now seventh in our latest Asia RRR table.
Key Trends And Developments
The tablet market in India is continuing rapid growth in 2013 after taking off in 2012. We believe there were sales of around 2mn tablets in 2012, a figure we expect to drive higher to 3mn in 2013. Sales moved higher in H212 with the success of local brands with seven-inch low-cost Google Android devices that has seen the likes of Datawind, MicroMax and Karbonn take market share from global leaders such as Apple and Samsung that have no mass-market devices for Indian level incomes. In 2013 a key trend is the ongoing procurement of tablets for education, most notably the Akash 2 produced by Datawind, which has pitched for a further distribution of 1mn tablets. However, global vendors are not far behind, with Taiwanese vendors Asus and Acer releasing low-cost models in India during 2013.
For its part India's Manufacturers' Association for Information Technology (MAIT) reported that sales of PCs in urban areas amounted to 11.17mn units in the 2012/13 financial year, which corresponded to a growth rate of 5%. Within this figure, sales of desktop computers were up by 1% to 6.77mn, while sales of laptops were up by 10% to 4.40mn. However, the main area of growth was in the tablet sector, which is tracked separately by MAIT. Sales in this sector shot up by as much 424% - albeit from a low base - to reach 1.90mn units. Over the same period, server sales declined by 2% to stand at 89,075 units, while printer sales were down by 1% to 2.93mn units. Among printers, the only segment to experience growth was laserjets, with sales were up by around 14% to 1.57mn units.
In terms of industry developments, it was confirmed in July 2013 that Hewlett Packard (HP) had postponed plans to sell its 60% stake in the Bangalore headquartered IT services company MphasiS. HP was instead focusing on consolidating its under-performing core PC business. HP's change of heart came as a blow to MphasiS' founder Jerrry Rao, who, in collaboration with his former colleagues, had raised more than US$1.5bn to mount a buyback bid.
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