Fast Market Research recommends "India Consumer Electronics Report Q3 2013" from Business Monitor International, now available
Boston, MA -- (SBWIRE) -- 08/14/2013 -- BMI projects that Indian consumer electronics spending will grow by about 17% in US dollar terms in 2013 to US$37.5bn, driven by rising incomes and growing affordability. Only nine out of 1,000 people in India own a computer, one-fifth of the level in China. Meanwhile, Indian mobile penetration is about 60%. Another long-term driver of growth is that 45% of India's population is under 25. Spending on consumer electronics devices is projected to grow at an overall CAGR of 14% through to 2017, with the key segments including low-cost mobile handsets, colour TV sets, set-top boxes and notebook computers. Much of the growth during BMI's five-year forecast period will be driven by growing demand from India's relatively underpenetrated rural areas. The popularity of smartphones, which drove double-digit growth in the handset market in 2012, demonstrates that there are also opportunities for high-end products. However, there are concerns that a new import tax on handsets priced at above 2,000 rupees could constrain demand in this key product category.
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Headline Expenditure Projections
- Computer Hardware Sales: US$9.7bn in 2012 to US$11.3bn in 2013; +17.0% in US dollar terms. Forecast in US dollar terms unchanged but tablets and Windows 8 devices will be areas of growth.
- AV Sales: US$12.7bn in 2011 to US$15.3bnin 2013; +20% in US dollar terms. The result is unchanged, with TV sets expected to provide the most dynamic development as households upgrade to digital.
- Handset Sales: US$9.7bn in 2012 to US$10.8bn in 2013; +12% in US dollar terms. This figure is unchanged, with vendors likely to increase their focus on semi-urban rural customers, but a new import tax could add 8%-9% to the cost of some handsets.
India's score is 49 out of 100, putting it in eighth place in our latest Asia Central Europe Risk/Reward Rating (RRR) table. BMI expects India to rise up the table over time as a result of economic growth and the potentially vast market in rural and semi-rural areas.
Key Trends & Developments
- In 2013, strong growth opportunities are expected across the next 200-400 smaller cities in India, where vendors are expanding their retail and distribution presence. Around 45% of new PCs sold in the Indian market are now shipping outside the top 75 cities. The government's policy of providing tax breaks and subsidies for hardware manufacturers should help keep PC prices down and support growth. Meanwhile education procurements, such as those being implemented by Tamil Nadu state and others, will also drive volume sales.
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