PC sales dip 19% in Q2 on inflation woes

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New Delhi, Sep 11: Rising inflation and economic turmoil has dealt a severe blow to buying sentiments of consumers in India, with the PC market showing a negative growth of around 19% in the second quarter of 2008 compared to the first quarter. “With the Indian economy expected to grow only at 7.5-8.0% in the current fiscal, the Q2 2008 performance was affected by cautious PC buying,” said Kapil Dev Singh, country manager, IDC India.

During the April-June quarter (Q2) of 2008, the Indian PC market recorded shipments of 2.085 million PCs, a growth of 8.1% over the same period last year. However, in the first quarter of 2008, the market grew by 10%. “The subdued sentiment derives its signals from high petroleum prices, rising inflation, political uncertainty in the last quarter and news of the impending US economic slowdown”, Singh added.

During the quarter, desktop PC shipments displayed a drop of 2.4% compared with the same period last year. On the other hand, notebook PC shipments showed a growth of 51.2%. The report notes that major global and Indian PC vendors promoted their ‘low-cost notebook PC’ offerings during the quarter.

“The growth of these upgradeable notebook PCs will be driven to a large extent by penetration of broadband connectivity and availability of appropriate content,” said Sumanta Mukherjee, analyst, computing products research, IDC India. However, their share in the total PC market remains miniscule. IDC estimates peg the ultra low-cost notebook PC category’s share at 0.42% in total notebook PC shipments in Q1 of 2008.