InvestorIdeas.com - India PC market crosses 6.5 million shipments mark in 2007

India PC market crosses 6.5 million shipments mark in 2007

Records 20% Year-on-Year growth

Notebook PC shipments touch nearly 1.8 million units: IDC India

Bangalore / Mumbai / New Delhi, February 27, 2008 – The India Client Personal Computer (PC) market crossed yet another milestone to ship nearly 6.5 million PCs in a calendar year, thereby recording 20% year-on-year growth in unit shipments (compared to 5.4 million units in CY2006). This was reported by CyberMedia India subsidiary, IDC India as one of the key results of the India Quarterly PC Tracker, 4Q 2007, February 2008 release.

Commenting on these findings, Mr. Kapil Dev Singh, Country Manager, IDC India said, “In CY2007 notebook PC shipments accounted for over a fourth of the total Client PC shipments. This healthy trend points to the maturing of the Indian IT market and shift into a new phase of growth – Growth Phase 2.0.”

“The notebook PC shipments touching 1.8 million units (as against 0.98 million in CY 2006), reinforces the increasing acceptance of laptops as the preferred choice for a large number first time PC buyers,” Mr. Singh added.

In the overall Client PC (Notebooks and Desktops combined) market HP retained the top spot with a market share* of 21%, followed by HCL at 13%, and Lenovo at 10% in terms of unit shipments.

In the total desktop PC market, HP retained the top spot with HCL a close second. Lenovo was placed in the third spot. In terms of commercial desktop PC shipments* HCL led the market followed by HP and Lenovo. In terms of consumer desktop PC shipments* HP led the market in CY 2007 followed by HCL and LG Electronics.

In the total Notebook PC market HP retained the top spot with a market share of 37% in CY 2007 in terms of unit shipments. Lenovo and Acer were at second and third spots with market shares* of 16% and 10%, respectively.

The key market highlights of 2007 were:

Notebook PCs become mainstream - Notebook PC shipments accounted for more than 27% of the total India Client PC shipments for the first time in a calendar year

Supportive Ecosystem Needed – Urgent need to encourage development and widespread adoption of the 3Cs of Communication, Convergence and Content to spur future growth

Table 1. India PC Shipments by Product Type, CY 2007 Product Type Year-on-Year Growth*
Desktop PCs 7%
Notebook PCs 81%
Consumer Client PCs 23%
Commercial Client PCs 19%
Client PCs$ Total 20%

* Year-on-Year Growth – JFM-OND 2007 over JFM-OND 2006,
$ Includes all Desktop PC and Notebook PC shipments

Table 2. India Client PC Market: Vendor Rankings and Market Shares, CY 2007 Total Client PC (Desktops & Notebooks) Market Total Notebook PC Market
HP 21% HP 37%
HCL 13% Lenovo 16%
Lenovo 10% Acer 10%

Notebook PC shipments grow to 27%
Notebook PC shipments accounted for 27% of the total India Client PC share in CY 2007 as Consumer Client PC growth shot ahead of Commercial PC shipments growth in CY 2007. According to Mr. Piyush Pushkal, Manager, PC Research, IDC India, “With consumer desktop shipments reporting flat growth, the higher overall growth of the consumer client PC segment signals maturing of the market. The consumer PC category is transitioning from a desktop-centric to a notebook-centric phase of growth.”
Product Category CY 2005 shipments(million units) Y-o-Y Growth(CY 2005 overCY 2004) CY 2006 shipments (million units) Y-o-Y Growth(CY 2006 overCY 2005) CY 2007 shipments (million units) Y-o-Y Growth(CY 2007 overCY 2006)
Total Desktop PC Market 3.9 19% 4.4 14% 4.7 7%
Total Notebook PC Market 0.5 148% 1.0 106% 1.8 81%
Total Client PC Market 4.3 26% 5.4 24% 6.5 20%

Supportive Ecosystem Needed
IDC believes that there is an urgent need to encourage development and widespread adoption of the 3Cs of Communication, Convergence and Content to spur future growth.

With portability being the prime driver for notebook PC sales, the market witnessed launch of new notebook PC-type products featuring small screen sizes at a sub-Rs. 20,000 price point. The PC-type gadgets such as the Asus Eee PC and HCL’s MiLeapX incorporate an intuitive graphic user interface for simplicity and ease of use. Many more such gadgets are expected in CY2008.

"These low-end notebook PC-type gadgets are not likely to increase PC penetration in India in a significant manner. To increase PC penetration, the ecosystem will need to offer more affordable Internet infrastructure, growing number of local applications and Indian language content, e-commerce and education. The PC-type gadgets are likely to function only as secondary computing devices in existing PC owning households", Mr. Pushkal commented.

"It is not just product features but relevance of PCs in the lives of ordinary citizens that needs to be addressed,” Mr. Pushkal added.

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