Personal computer shipments bounce back in March quarter: IDC

Shipments fell 15.2% in 2016 due to a slowdown in consumer demand and the effects of note ban

Personal computer (PC) and laptop shipments grew 8.54 per cent, year on year, to 2.16 million in the March quarter, according to market research firm IDC.

PC shipments declined by 7.8 per cent to 1.99 million during the same quarter last year. Shipments fell 15.2 per cent in 2016 due to a slowdown in consumer demand and the effects of the note ban in the last two months of the year.

The consumer PC segment, which forms 48.6 per cent of total shipments, witnessed healthy growth of 14.5 per cent in the March quarter. Consumer PC shipments stood at 1.05 million during the quarter, up from 0.92 million in the same period a year ago.

According to Manish Yadav, associate research manager, client devices, IDC India, demand was back in the consumer PC market after the demonetisation blues during the December quarter. 

The share of the consumer notebook category grew by 1.6 percentage points in the March quarter to 38.4 per cent from 36.8 per cent a year ago.

During the past few months, the consumer PC market has been witnessing new launches and category expansion by the top three players, HP, Dell and Lenovo. HP has introduced its gaming laptop series Omen and  Lenovo has strengthened the category by product launches. According to IDC, with the focus on enriching gaming as a potential segment, manufacturers “are looking to revamp their product portfolio and upsell in mid- to premium range”.

To cash in the growing need among small and medium businesses to become GST ready, Dell has come up with a range of desktops and notebooks under its Vostro brand.

Shipments of commercial PCs inched up by 3.3 per cent to 1.11 million in March. Companies continued to spend on infrastructure despite uncertainty over macroeconomic conditions. IDC expects the segment will grow over the next few quarters driven by government-sponsored education projects.

However, implementation of the GST could impact the sector initially, with a supply side crunch during the initial few weeks. PCs are in the 18 per cent GST tax bracket, which is higher than the present effective rate of 14 per cent. 

Stocking by dealers and distributors remains a concern as the GST it might hamper input tax credit. To minimise the impact, firms are realigning their production and distribution strategies and trying to bring trade partners on board.

“IDC India anticipates a short-term postponement and resistance by traders during the GST implementation phase. But in the long run the effect will be neutralised,” Yadav said.