Market On Growth Track

With a 26% quarter-on-quarter growth in desktop PCs, the market is indeed on a growth track. The first quarter of the current financial year sold 6,41,812 PCs against 5,08,601 sold in the first quarter of 2002-03 contributing to a healthy growth.

The sales figures put out by the MAIT Quarterly Industry Performance Review are all about optimism in the coming days and months. Except for notebooks (8%), all the rest of the product categories have scored a double-digit growth, with laser printers achieving as much as 60%.

We have every reason to believe that the kind of growth witnessed in the first quarter will continue for the rest of the financial year and beyond. The macro economic parameters are on a sound track and the stock markets have reacted positively with a strong bullish undertone. 

Corporates are announcing healthy quarterly results with bulging bottomlines. What this implies is that enterprises will have cash to spend on IT which was being withheld for a long time now as a cost-cutting measure.

This is evident from the fact that the top four cities where majority of the enterprises and corporates are located, accounted for 46% of the PC sales, while the next four, 17%. These figures belie the fact that metros have reached a saturation point. 

Perhaps saturation in business was experienced in the recent past because companies were not willing to loosen up their purse strings as the economy was going through a rough patch. But the situation has changed for better and the positive figures are a pointer to that reality. 

Business in smaller towns continues to grow rapidly and these contributed 37% of the PC sales. The focus of vendors to reach out to B and C-class cities in recent times, is indeed yeilding results as all product categories, including notebooks, show a double-digit share of business.

The dot-matrix printers had the highest share at 52% in smaller towns. Compare this with the highest growth achieved in laser printers across the country, which leads us to an important conclusion: metros are made for lasers and dot-matrix printers for smaller towns.

The growth rate for lasers has come mainly from enterprises and corporates with the buying power. And these are based out of metros because in smaller towns, the lasers have a share of only 19%.

The figure for notebooks is another story! While the overall growth is pegged at only 8%, their share in smaller towns stands at 17%. Maybe notebooks have reached a saturation point in the metros but not in B and C-class towns. 

MAIT projects a sale of 7,84,188 desktop PCs in the second quarter of this financial year, an easily achievable figure taking into consideration the overall positive sentiment in the market. Partners have to quickly seize the opportunity to exploit both the markets with the right kind of strategies that satisfy the cash-rich customers in metros and the cost-conscious smaller towns.

SYLVESTER LOBO