DEVI AHILYA VISHWAVIDYALAYA INDORE

SCHOOL OF COMMERCE SESSION 2008-11 A Project Report on “MARKET SURVEY ON CONSUMER ELECTRONIC INDUSTRY IN INDIA”
Under the guidance of: Mr.Kapil Sharma Submitted by: Batul Kudrati MBA (FT) 5 yrs VI SEM

DX-08-2209
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CERTIFICATE
This is to certify that the project work done on “Market Survey On Consumer Electronic Industry in India”, submitted to School of Commerce, DAVV, Indore by Ms. Batul Kudrati in partial fulfilment of the requirement for the award of Degree of Masters of Business Administration (Integrated) in Foreign Trade is a bonafide work carried out by her under my supervision and guidance. Certified further, to the best of my knowledge that the work reported here in does not form part of any other project report or dissertation on the basis of which a degree or award was conferred on an earlier occasion on this or any other candidate.

Mr.Kapil Sharma Guide/Supervisor Date:

Dr. L.K. Tripathi Head of Department School of Commerce

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DECLARATION
I, Batul Kudrati, hereby declare that the project work titled ‘Market Survey on Consumer Electronic Industry in India’ submitted to School of Commerce, DAVV, Indore is an original work of mine done under the guidance of Mr.Kapil Sharma in requirement for the award of my degree of MBA (Integrated) and the research done in this report has not been submitted to any other university or institute before.

Place: Indore Date:

Name: Ms Batul Kudrati MBA [FT] 5 yrs. VI Sem.

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Kapil Sharma (Institute of Management Studies) who guided me throughout my report work related with Market Survey on Consumer Electronic Industry in India which plays an import role in export from India and he also gave his valuable time for suggesting modifications with attention and care. Tripathi. I am also grateful to the staff and other faculty members of School of Commerce and also to my friends for their support. I would also like to express my sincere thanks to my Head of the Department. who supported me during the work. Dr. Batul Kudrati Date: 4 .ACKNOWLEDGEMENT I owe great thanks to my faculty.K.L. Mr.

VCD/MP3 players. dealers. demand for these products is growing rapidly and investments are flowing in to augment manufacturing capacity. which has grown at a CAGR of 10% in the last five years. and trade unions. suppliers.PREFACE The worldwide electrical and electronic and computers industry is the most flourishing and extremely diversified sector consisting of manufacturers. The Indian industry constitutes less than 1% of the global market. The consumer electronics segment. electrical engineers. includes a wide range of products such as DVD. television sets and microwave ovens. Thus. However. retailers. electronic equipment manufacturers. electricians. This sector has been growing at a rapid pace with the invention of innovative technologies and an ever-increasing customer inclination towards electronic goods and services. I have undertaken this research project to determine the factors for growth of this industry in India as well as to determine the major player in the consumer electronics segment of this industry. 5 .

6 . opportunities and threat of Indian consumer electronic industry. • To study the impact of the sector on the Indian economy. weakness.OBJECTIVE • To determine the strength. • To determine the major market player in the consumer electronic industry • To understand the industry characteristics • To study and analyze the various government policies and initiatives towards the sector.

• Survey would be conducted with the help of questionnaires.RESEARCH METHODOLOGY • This research is based on observation and survey method. • Secondary data available with different organization’s website contributing towards this sector will also be considered. 7 . • All published and non-published data available on the subject matter will be consulted.

Growth Drivers 1.2 Industrial Electronics 2.5 Electronic Components 8 Page No.1 Computer Industry 2.INDEX Topics Certificate Declaration Acknowledgement Preface Objective Research Methodology Chapter 1: INDIAN ELECTRONIC INDUSTRY 1.3 Communication and Broadcasting Equipments 2.6. 2 3 4 5 6 7 13 14 15 16-19 20 21-23 24 25 26 27-29 30-31 32-33 34-35 36-37 .3 Production Profile 1.4 Size and Growth of Indian Electronic Industry 1.5 India’s Export of Electronic Goods 1.2 Current Scenario 1.1 Historical Developments 1.8 Government Initiatives Chapter 2: Key Segments of Indian Electronic Industry 2.4 Strategic Electronics 2.

6 Key Players Chapter 3: Consumer Electronics Industry in India 3.2 Major International Players Chapter 5 .2.1.4 Threats Chapter 6 : Survey 6. Favourable Demand Conditions for Growth 3.Survey Method 9 38 39 40-41 42-44 45-46 47-48 49 50 51-52 53 53-54 54 55 56-59 60-63 64 65 66 67 68 69 70 .Consumer Electronic Industry 3.8.2 Weakness 5.7 Indian Export of Consumer Electronics 3.Key Success and Risk Factors for Consumer Electronic Industry 3.6 Air Conditioner Market in India 3.9. Colour Television Market in India 3. SWOT Analysis 5.5 Microwave Market in India 3.1 Strengths 5.4 Washing Machine Market in India 3.3 Opportunities 5.2.1 Major Domestic Players 4.3 Refrigerator Market in India 3.1.10 Scope Chapter 4 :Major Players in Indian Consumer Electronic Industry 4.

Chapter 7 :Analysis and Findings Chapter 8 : Conclusion and Suggestions Annexure References 71- 10 .

2010-2020 Exhibit 7: Electronics&IT Exports Exhibit 8: Growth in Exports of Electronics $ Computer Software / Services Exhibit 9: Share Electronics.Charts. Computer Software/Services in India’s Total Export Exhibit 10: Major Destinations for Electronics & Computer Software / Services Exhibit 11: Computer Sales and Growth Exhibit 12 :Market size and growth of other IT Hardware Equipment Exhibit 13: COMPUTER HARDWARE PRODUCTION Exhibit 14:INDUSTRIAL ELECTRONICS PRODUCTION Exhibit 15:Communication and Broadcasting sector Production Exhibit 16 :STRATERGIC ELECTRONICS PRODUCTION Exhibit 17:Electronic Components 11 Page no. Diagrams and Graphs Exhibit Exhibit 1: Evolution of Indian Electronic Industry Exhibit 2: Electronics and IT Production Profile Exhibit 3: Production and Growth trend of the Indian Electronics and IT-ITeS industry Exhibit 4: Major Production Clusters Exhibit 5: Size of Indian Electronic Industry Exhibit 6: Indian Electronics Industry Projections. 14 16 16-17 19 20 20 21 22 22 23 27 28 28 30 33 35 36 .

Production Exhibit 18:Key Players in the Indian Electronic Industry Exhibit 19: Growth in the Consumer Electronic Industry Exhibit 20: Consumer Electronics Production Profile Exhibit 21: Projected market Growth for television industry Exhibit 22: Projected Market Sales for television industry Exhibit 23: Projected sales of refrigerator Exhibit 24: Growth in Export of Consumer Electronics Exhibit 25 :Most Preferred Brand in Consumer Electronics Exhibit 26: Most Preferred Brand in Refrigerator market Exhibit 27: Most Preferred Brand in Television Market Exhibit 28: Most Preferred Brand in Washing Machine Market Exhibit 29: Most Preferred Brand in Microwave Market Exhibit 30:Most Preferred Brand in Air Conditioner Market Exhibit 31: Most Preferred Brand in Mobile Industry Exhibit 32 :Most Preferred Brand in Computer/Laptop Industry 38 41 41 42 43 45 51 72 72 73 73 74 74 75 75 12 .

CHAPTER 1 INDIAN ELECTRONIC INDUSTRY INDIAN ELECTRONIC INDUSTRY 13 .

Historical Developments The Electronics Industry in India took off around 1965 with an orientation towards space and defence technologies. have made a mark globally. Pressure on the electronics industry remained though growth and developments have continued with digitalisation in all sectors. Calculators and other audio products. 1985 saw the advent of Computers and Telephone exchanges. After the software boom in mid 1990s India's focus shifted to software.the government allowed thousands of colour TV sets to be imported into the country to coincide with the broadcast of Asian Games in New Delhi. Exhibit 1: Evolution of Indian Electronic Industry Current Scenario 14 . Samtel Colour. Celetronix etc. At the same time companies like Moser Baer. In 1982-a significant year in the history of television in India . From 1991 onwards. This was rigidly controlled and initiated by the government. Colour Televisions soon followed. The period between 1984 and 1990 was the golden period for electronics during which the industry witnessed continuous and rapid growth. In the subsequent years. there was first an economic crises triggered by the Gulf War which was followed by political and economic uncertainties within the country. While the hardware sector was treated with indifference by successive governments. In 1997 the ITA agreement was signed at the WTO where India committed itself to total elimination of all customs duties on IT hardware by 2005. This was followed by developments in consumer electronics mainly with transistor radios. a number of companies turned sick and had to be closed down. which were succeeded by Digital Exchanges in 1988. Black & White TV. and more recently the trend towards convergence of technologies. Moreover the steep fall in custom tariffs made the hardware sector suddenly vulnerable to international competition.

diversifying and expanding manufacturing sectors in India. according to Frost and Sullivan. and expanding its manufacturing base in India. Japan. Their growing tech-savvy culture. By 2015. India now offers a huge potential and opportunity as a market as well as a manufacturing base to cater not only to the growing domestic market but also to the global market. The emergence of a business-friendly economic environment in India has attracted almost all major consumer electronics players from South Korea. telecom products including mobile phones. audio-video equipment. Production Profile 15 . domestic white goods etc. However the demand in the Indian market is growing rapidly and investments are flowing in to augment manufacturing capacity. There has been a significant rise in the disposable surplus income with the middle class families in India. IT hardware.7 per cent of the global electronic industry.The electronic hardware and components industry has emerged as one of the dynamic. They import as well manufacture locally to sell in the large domestic Indian market. UK. The total electronic hardware and components market in India is estimated US$ 363 billion. Hence it is miniscule by international comparison. As a result. the Indian electronic industry has been diversifying its product range. the TAM (Total Available / Accessible Market) for the local Indian manufacturing industry is US$ 158 billion. particularly home entertainment systems. Germany. India’s burgeoning software sector is generating huge demand for IT hardware and components in the domestic market. USA. passion for latest fashion and purchasing power is fuelling a high demand for hi-tech high-end consumer electronic products. high resolution LCD / Plasma TVs. The electronic industry in India constitutes just 0. and China etc. vibrant.

0 billion) in 2010-11 as compared to 237.450 415.820 372.000 295.Exhibit 2: Electronics and IT Production Profile The performance of Electronics & IT-ITeS industry in 2010-11 was marked by sustained recovery and resurgence in growth momentum.2 25.1 .6 per cent in 2009-10.0 per cent in dollar terms.300 24. The total production of Electronics & ITITeS Industry is estimated to grow at 13.9 11.3 21.8 per cent in rupee terms and 18.630 Crore (US $ 59. an increase of 13. In 2010-11 the Indian software and services exports industry witnessed a surge in the growth.6 13. The production and growth trend of the Indian Electronics and ITITeS industry since 2005-06 has been as follows: Exhibit 3: Production and Growth trend of the Indian Electronics and IT-ITeS Year Production Growth (1%) ( Crore) 2005-06 190.9 2006-07 2007-08 2008-09 2009-10 2010-11 16 244. which is export driven and continues to dominate the electronics and IT industry.090 28. The total value of software and services exports is estimated at 269.520 470.1 per cent in 2010-11 as against 11. This increase in growth is attributed mainly to the accelerated growth of software and service industry.000 Crore (US $ 50 billion) in 2009-10.

Jabil. Embedded in VLSI. single and double sided. TVS Electronics. Texas Instruments. The production performance of various industry groups in the Electronics Hardware and Software & Services Sector in 2010-11 is given below Electronic Contract Manufacturing / Electronic Manufacturing Services India is fast emerging as one of the leading hubs for Electronic Contract Manufacturing (ECM) / Electronic Manufacturing Services (EMS) and Original Developer Manufacturing (ODM) in the South Asian Region. telecom product sectors etc are outsourcing their requirements from India. Dixon Technologies India Pvt Ltd and many more. Samsung. IT. single and double sided as well as multi layer printed circuit boards etc. office automation. Magnetic components. automobile. chip designing. Digital Circuits Pvt Ltd.The above table indicates that Electronics and IT-ITeS industry has not only overcome the adverse impact of severe global recession but also staged a remarkable recovery in 2010-11. Alcatel. Celestica. Epitome Components Ltd. Flextronics. SGS Tekniks Manufacturing Pvt Ltd. superior quality etc. prototyping from boxed products to SMT / PTH PWBA’s . Matsushita. and Lenovo have already set up manufacturing operations in India. Software and services exports. DSP in VLSI. Benchmark Electronics. 17 . Motorola. RFID passive Tags. on time delivery. D-Link. Flex PCB & assemblies. power electronics. Because of cost advantages. OEMs from industrial electronics. LG. IP core designing. Major international players like Nokia. Syrma Technology Pvt Ltd. They have also set-up R & D centers in India. Siemens. This growth has attracted global players to India and leaders like Solectron. Solectron. Flex circuits. Fusion Electronics Pvt Ltd. They provide a full spectrum of value added services including circuit design. which constitute about 57 per cent of Electronics and IT-ITeS industry’s revenue aggregate has returned to double digit growth trajectory in 2010-11. The leading Indian companies in this segment include Flextronics. India Emerging as a Major Manufacturing Base in Asia: India is emerging as a major manufacturing base in the area of consumer electronics and telecom equipment. MPEG cards.

this growth is expected to continue at least over the next decade. Regional spread of Indian Electronic units India’s electronics hardware industry is concentrated in 3 main regions --. this growth is expected to continue at least over the next decade. as well as consumer electronics is equally brisk. office equipment. power electronics equipment. TV tubes. Audio equipment and other entertainment products. The electronics industry employs more than 400. accounts for 32% of the output. Combined with low penetration levels and the Indian economy growing at an impressive 7 per cent per annum. auto electronics. test and measuring instruments.the Northern Region around Delhi. medical. strategic electronics. as well as consumer electronics is equally brisk. partly linked to the presence of Indian defence establishments in the city. process control equipment. which is mainly around Bangalore. Bangalore has much concentration of public sector units and organsied private sector players. The growth in telecom products demand has been breathtaking and India is adding 2 million mobile phone users every month! With telecom penetration of around 10 per cent. electronic components. Combined with low penetration levels and the Indian economy growing at an impressive 7 per cent per annum. auto electronics. industrial. CD/DVD Players. There are more than 3500 units in both organized and unorganized sectors in India who are engaged in manufacturing of electronic goods as diverse as audio / video products. the projection of a US$150 Billion+ market is quite realistic and offers an excellent opportunity to electronics players worldwide. analytical and special application instruments. The growth in telecom products demand has been breathtaking and India is adding 2 million mobile phone users every month! With telecom penetration of around 10 per cent. Major production clusters 18 . Elcoteq and many more have made large investments to access the Indian market. the projection of a US$150 Billion+ market is quite realistic and offers an excellent opportunity to electronics players worldwide. In consumer electronics Korean companies such as LG and Samsung have made commitments by establishing large manufacturing facilities and now enjoy a significant share in the growing market for products such as Televisions. telecom products and equipment. Hyderabad and Chennai. medical.000 persons in both the organized and unorganized sectors. industrial. Penetration levels in other high growth products are equally high and growth in demand for Computer/ IT products. the National Capital of India which accounts for 37% of the output. Penetration levels in other high growth products are equally high and growth in demand for Computer/ IT products. medical electronics equipment. The Western Region around Mumbai and Pune accounts for 25% and the Southern Region.Nokia.

City State Ahmedabad Gujarat Bengaluru Karnataka Gurgaon Haryana Hyderabad Andhra Pradesh Mumbai Maharashtra Noida Uttar Pradesh Pune Maharashtra Chennai Tamil Nadu Exhibit 4: Major Production Clusters SIZE AND GROWTH OF INDIAN ELECTRONIC INDUSTRY Exhibit 5: Size of Indian Electronic Industry 19 .

2010-2020 INDIA’S EXPORT OF ELECTRONIC GOODS 20 .Exhibit 6: Indian Electronics Industry Projections.

The total value of software and services exports are estimated at 269. Exhibit 7:Electronics&IT Exports Exhibit 8: Growth in Exports of Electronics $ Computer Software / Services 21 .4 per cent. as compared to 262.900 Crore in 2009-10 showing a growth of 12.000 Crore in the year 2009-10.530 Crore. an increase of about 13. as compared to 237.Electronics and Computer Software / Services Exports During the year 2010-11. electronics and IT exports are estimated to be 295. The software and services exports witnessed a robust recovery.8 per cent.630 Crore in 2010-11.

Exhibit 9: Share of Electronics.12 percent in Indias over all export during the year 2008-09. 259060 Cr (US$ 56.33 billion) accounts for a share of 19.64 billion). 1355049 crore (US$ 294.Share of Electronics and Computer Software / Services export in India’s total export. India’s overall export during the year 2008-09 is estimated to be Rs. Computer Software/Services in India’s Total Export 22 . India’s Electronics and Computer Software / Services export valued at Rs.

Major Destinations for Electronics & Computer Software / Services Exhibit 10: Major Destinations for Electronics & Computer Software / Services 23 .

The fastest growing segments are demand for telecom services particularly cell phones. office automation. • Presence of global Electronics Manufacturing Services (EMS) majors in India and their plans for increased investments in India. especially for design and engineering services with good Communication skills. Within next 5 years penetration of telephone users (both landline & mobile) is projected to increase from 100 to 500 per thousand while PC's increase from 10 to 30 plus per thousand. Some of the other factors are • Highly talented workforce. • More outsourcing of manufacturing by both Indian and global Original Equipment Manufacturers India’s Advantages: • • Abundance of technically qualified skilled manpower at competitive rates. Industry friendly socio-political business environment in the country. internet subscribers & growth in demand for its products with increasing penetration of computers. IT. ancillaries / accessories for OEMs from industrial electronics.THE GROWTH DRIVERS Behind the impressive growth of the electronics industry is the robust and consistent growth in Electronic Hardware market of approximately 25 per cent due to a stable economy & large middle class of 350 million people. • • • Fast growing India’s domestic market. process know how etc under the Electronic Contract Manufacturing or EMS. Propensity of consumers for branded products. • Rising labor costs in China. aviation electronics sectors etc as per the buyers designs & technical specifications. Government Policy Initiatives: 24 . automobile. power electronics. components and accessories. and India’s fast growing technical capability to emerge as the highly sophisticated and technologically advanced production facilities for sub-assemblies and manufacturing services. falling prices & Government support to rapidly encourage usage of IT in all sectors. • Forward looking investment friendly Government’s Incentive Package Schemes.

and . light emitting diodes. photo voltaic. incentives include 20 % subsidy on the capital expenditure made during the first 10 years for facilities established in Special Economic Zones (SEZ) or 25 % for facilities built outside SEZs. nano and micro technology products. Govt.• 100 % Foreign Direct Investment is allowed under the automatic route with a few exceptions such as Aerospace and defence equipment manufacturing which requires a specific approval from the Government of India. liquid crystals.Incentives of up to 20 % subsidy towards capital expenditure • • Electronic Hardware Technology Parks set up to encourage investments in this sector in several States ( Chennai. storage devices. Cuttack ) The Government of India’s Special Incentive Package Scheme ( SIPS ) aims at kick starting semiconductor wafer fabrication and its associated downstream or upstream investments for manufacturing of semi-conductor grade silicon or wafers. Bangalore. 25 . plasma display panels. solar cells. The Government of India has recently announced a progressive semi-conductor policy which provides : -Special Incentive Package for setting up semi-conductor fabrication and other micro and nano technology units. US $ 240 million) for associated ecosystems. The investment threshold for fabs is Rs 2500 crores (about US $ 600 million) and Rs 1000 crores (approx.

CHAPTER 2 KEY SEGMENTS OF INDIAN ELECTRONIC INDUSTRY KEY SEGMENTS OF INDIAN ELECTRONIC INDUSTRY 26 .

Establishments which had been postponing their major IT purchases in last few quarters are now ready to invest in IT.5 million in 2009-10.7% Exhibit 11: Computer Sales and Growth COMPUTER SALES NOTEBOOKS DESKTOP PERSONAL COMPUTER 2009-10 2010-11 GROWTH 2.11 against 5.2 million in 2010. The Notebook sales are estimated to be 3. With significant IT adoption plans on the anvil. ITeS (Information Technology enabled Services). a growth of 12.COMPUTER INDUSTRY Computer Hardware India is one of the fastest-growing IT systems and hardware market in the Asia-Pacific region. Desktop sales are expected to reach 6.5 MILLION 5.5 MILLION 6.5 million in 2010-11 against 2. BFSI (Banking. Most MNCs have their assembly units in India. telecom.5 MILLION 7. a growth of 40 per cent. the IT systems and hardware market is expected to expand rapidly in the ensuing years. manufacturing verticals. Small & Medium Enterprises (SMEs). The small city growth is largely fuelled by the larger organizations strengthening their base in smaller cities on account of 27 .5 million in 2009-10. e-Governance and households are the key drivers of the IT systems and hardware market in India. Financial Services and Insurance). This shows that Notebooks have caught the fancy of the consumers. which could be the major reason for the growth in the server sales.7 MILLION 40% 12.7 million. The Server market is expected to register positive growth in the future as the Server market expands to smaller cities and Small and Medium Businesses (SMBs).2 MILLION 9. PC sales are expected to record a growth of 12 per cent in 2010-11 to touch 9.5 MILLION 3.7% 12 % As regards servers. Most of the prominent global vendors and some locals have strong presence in the Indian market. sales posted a growth of 41 per cent during second quarter 2010-11 on account of the easing of the Economic slowdown.

etc.970 Crore. The SMB growth is largely fuelled by the adoption of nontraditional businesses like education. retail.000 units 33% Network interface Cards 4.cost advantages.000 units About 1% Routers and Switchers US $ 320 million and US $ 36% and 25% respectively 440 million respectively Hubs 192. Exhibit 12: Market size and growth of other IT Hardware Equipment PRODUCT MARKET SIZE GROWTH Servers 90. This is largely due to decelerating growth in exports.85 million units 43% Notwithstanding this surge in PC sales. healthcare & hospitality. domestic production is estimated to remain flat in 2010-11 at 14.2 million units 15% Modems 0. Exhibit 13: COMPUTER HARDWARE PRODUCTION Key Success and Risk Factors for Computer Industry 28 . substitution of domestic production by cheaper imports and rising input cost.

Malaysia. Demand Drivers Following are the major demand drivers of the computer industry : • • • • • Increasing household income Domestic demand by Indian companies e-Governance initiatives under the National e-Governance Program (NGEP) IT based education in India Growth of IT and ITES industry Industrial Electronics 29 .Key Success Factors • Newer and sleeker products • Effective distribution model • Competitive pricing Key Risk Factors • • • • Easy replicability Large number of fakes Grey market Excess capacities in Taiwan. etc.

The estimated production figure for this segment for 2010-11 is 18. Growth in industrial production and focus by industry on better controls. This process is continuing for a long time now. Semiconductors are integral part of most medical equipments. the sector is very largely dependent on import of critical hardware and associated software. medical electronics and other intermediates like semiconductor. Whereas we have a good amount of expertise in conceptualizing such systems and its erection and commissioning.This segment of Electronics/IT industry includes critical hardware technologies and systems with built-in software. distributed control systems. Newer technologies involving wireless 30 . Exhibit 14:INDUSTRIAL ELECTRONICS PRODUCTION This segment continues to be an important constituent from the perspective of applications for electronics and IT. The important devices used in this segment relate to power electronics.160 Crore in 2009-10. varied power electronic equipment and systems has been increasing in the country.190 Crore as against 15. It is a very challenging area which is multi-disciplinary in nature requiring high level of technical skill in designing systems for applications in a variety of industrial sectors of the economy. Manufacturing of related hardware in technology areas like PLC. a growth of about 20 per cent. this leads to higher initial cost and a much higher maintenance cost in the long run. processes and systems are expected to drive growth in this segment in the future. UPS. starting from high end imaging to small hand held devices. Large projects are implemented with total import of C&I packages from abroad without any knowledge of its design. In most cases.

The Industrial Electronics industry would be driven by sustained GDP and Industrial growth.) • Developing capabilities beyond low end manufacturing and assembly.etc.sensors and sensor networking are rapidly emerging as potential application in the field of industrial electronics on account of ease of installation and cost competitiveness. nanotechnology. Key Success and Risk Factors Key Success Factors: • Design capabilities and R&D • Addressing export markets through EMS • Quick adoption of high techmanufacturing (SMT. moving up the value chain Key Risk Factors: Regulatory risks (especially telecom) • Managing electronic waste and consequent environmental hazards • Communication and Broadcasting Equipments 31 .

India has taken a leading position in the mobile handsets market. 2010. DTH Sector Besides the free DTH service of Doordarshan. 2010 with overall urban and rural tele-densities being 147.18 respectively. RAX. This segment is expected to add 10-12 million subscribers every year.6 million in March 2009. a growth of about 5 per cent. Then number of active internet entities11 is expected to be 8.92 million in December. DTH with its digital picture and sound quality is able to deliver a much better performance vis-a-vis the analog cable operators.28 Million at the end of December. and second largest in Asia.000 Crore in 2009-10. optical fibre communication equipment. The FM radio policy has been well received and there are a total of 248 channels operated by 42 operators in 84 cities at the end of September.70.16 per cent in December. 2010.9. offering their services to the DTH subscribers.2010. The segment includes digital exchanges (EPABX. The overall Teledensity in India reached 66. Mobile Sector Communication technology has taken a big leap forward and received national recognition as a key driver for development and growth. Local manufacturing of Set-Top Box has now commenced and is meeting about 25 per cent of the total requirement of the DTH industry. The total broadband (256 kbps download) subscriber base of India is 10. It is set to overtake the US as the largest DTH market in the world by 2012. Mobile subscriber base has crossed 300 million and is expected to touch 500 million by 2010.550 Crore as against 31.44 million. satellite communication terminals. 2010. 260 billion.19 million as on December. Some of the world renowned mobile set 32 . Telephone Sector Communication Technology is a key driver for development and growth.876 in September-2010.09 million as on December. two-way radio communication equipment.88 and 31. 2010. Total wireless subscribers are 752. their reported subscriber base is 26.75. The gross telephone subscribers in the country reached 787. The estimated production figure for this segment for 2010-11 is 32. India is third largest in the world in terms of gross telephone subscribers. there are 6 private DTH licensees. The estimated production of this segment in FY2009 was Rs. 2010. Kolkata and Chennai increased from 7. TAX and MAX). Number of Set Top Boxes (STBs) installed in CAS notified areas of Delhi. As on 30.519 in June-2010 to 7. Mumbai. transmission equipment (HF/VHF/Microwave trans-receivers).Telecommunication equipment is the second fastest growing segment after IT hardware. The growth is from both the urban area (where subscribers are moving away from cable) and rural area (where cable has not reached). The total Wireline subscribers are 35.

navigation and surveillance system. navigational aids. sonars. increasing the demand for telecommunication infrastructure products and services. Samsung. the segment has seen a number of service providers such as MTS. • Demand for the Customer Premises Equipment and Fibre to Home are likely to driven in the long run. disaster management system. like Motorola. internal 33 . Exhibit 15: Communication and Broadcasting sector Production Demand Drivers for this Industry Following are the major demand drivers of this industry: Increasing mobile penetration to B and C circles with mobile connections touching 500 million in 2010 • Increasing number of wireline and wireless broadband (Broadband Wireless Access/Wiremax) users.Recently. underwater electronic system. • Strategic Electronics The strategic electronics segment envelops satellite based communication. Sony Ericsson and LG have set up production bases for mobile handsets in the country . radars. infra-red based detection and ranging system. and Virgin entering the segment. Swan.manufacturers.

The Government feels that it is desirable to focus on production in the strategic electronics sector to ensure acquisition of the state-of-the-art technology. a growth of about 10 per cent. in particular allowing India to collaborate with global companies on nuclear projects.680 Crore as against 6. economic growth and a focus by commercial aircraft manufacturers on lowcost countries are expected to create growth in the aerospace market in emerging markets in general and India in particular. etc. The role of IT in defence is expanding with the new focus on cyber security.980 Crore in 2009-10.security system. aerospace and nuclear sectors are poised for substantial growth on the back of economic growth and the need to maintain national and energy security. India is expected to be one of the top-5 markets for defence equipment by 2015. At the national level. Similarly. The sector is increasingly facing problems in attracting and retaining talent. various research institutions are developing strategic systems and public sector undertakings and some private agencies are contributing towards production. India’s defence. There is also a trend towards outsourcing/sub contracting and privatisation. India has an opportunity to play an important role in this global phenomenon. The Indian strategic electronic industry has been able to meet the bulk of the requirements of India’s defence and paramilitary forces. The civilian nuclear agreement between the US and India will enable commerce and cooperation. The estimated production figure for this segment for 2010-11 is 7. Driven by geo-political considerations. Exhibit 16 :STRATERGIC ELECTRONICS PRODUCTION 34 . 68 billion. Estimated production of this sector in 2008-09 was Rs.

• Major private participation from the likes of TATA group nad Mahindra group is underway. Electronic Components 35 .Demand Drivers of Strategic Electronics Industry Following are the major demand drivers of this industry: • Sustained GDP growth. • Increasing defence spending.

Exhibit 17:Electronic Components Production The components produced in India at present include TV picture tubes. PCs. ICs. hybrid microcircuits. switches. resistors. energy saving and driver assistance. Further. telecom. displays. the e-Governance initiatives of the government boost the demand for the segment. defense and IT verticals. commercial and enterprise. registering a growth of about 10 per cent. relays. Test. storage devices and advanced micro and nanotechnology products. and in the automotive industry for safety. These products and other semiconductor devices are used in several applications. capacitors. The growth in this segment has been driven by growth of semiconductors. xray tubes and cathode ray tubes.The production figure for this segment for the year 2010-11 is estimated to be around 14. display panels. The electronic component segment caters to the consumer electronics. magnetic heads. The demand in consumer electronics and mobile segment in India has maintained its growth trend in the year 2010-11. connectors.g. DC micro motors and tape deck mechanism. crystals. The key constituents include semiconductor. loudspeakers and hard and soft 36 . The growth in these segments is key determinants for the growth of electronic components. monitor tubes. Semiconductor manufacturing extends beyond wafer fabs to include Assembly. optical LEDs.970 crore as against 13.610 Crore in 2009-10. Printer Circuit Boards (PCB). The growth in electronic components is led by the increase in domestic consumption of IT products from residential. power devices. such as telecommunications for ubiquitous accessibility in electronics and consumer applications for product quality (e. solar photovoltaic. picture tubes. diodes and transistors. mobile phones and TV sets). capacitors. and resistors. Mark and Packaging facilities (ATMPs).

Presence of global majors like Flextronics.Nokia. The semiconductor products that are expected to drive the revenues are: • Microprocessor driven by desktops. Most of the top global semiconductor companies have set up their chip design centres in India. by nature of its growth in the IT/ITES industry. energy meters and converters. mobile and telecom infrastructure. Intel and others having their research facilities in India.ferrites. servers and telecom infrastructure • Discrete driven by TV and audio systems. monitors and UPS • Memory driven by desktops. notebooks and telecom equipment • Analog driven by mobile phone. KEY PLAYERS 37 . The world’s top five mobile handset makers . notebooks. Jabil and Elcoteq s creating potential for a quantum jump in hardware manufacturing in India and should have a downstream impact by stimulating demand for components and assemblies. India has already established a presence in the R&D for components with global electronics majors such as Texas Instruments. Motorola. Sony-Ericsson and LG have their manufacturing bases in India. While India’s presence as a base for manufacture of high end components is still underway. Samsung. The growth of electronic components depends on the growth of the other constituents of IT Hardware and Electronics sector to which it supplies.

Blue Star. Exhibit 18:Key Players in the Indian Electronic Industry Segments Consumers Electronics IT hardware Key players Videocon.Electronic Hardware sector has large number of players who operate across their respective value chains. LG Electronics.. Jabil Bharat Electronics Ltd Siemens. Voltas. Tektronix. Philips Telecommunication equipment Electronic components Strategic components Industrial electronics and others 38 . Reliance InfraTel Samtel. Samsung HCL Infsystems. Bharathi Teletech. Himachal Futuristics Communications Ltd. WIPRO Infotech.. MIRC. D-Link (India) Avaya Global. Philips. Flextronics India Ltd. Electronic Components and Strategic Electronics segments are still relatively in the nascent stage consist of a number of small players or large PSUs. A number of large MNCs operate are in the Consumer Electronics.. IT Hardware and Telecommunication Equipment segments. AT&S India Ltd.

Changing life styles. communication and entertainment is bringing new momentum in the consumer electronics industry in India.CHAPTER 3 CONSUMER ELECTRONIC INDUSTRY IN INDIA CONSUMER ELECTRONICS The convergence of information. Consumer preference has shifted towards 39 . higher disposable income and greater affordability is fuelling this growth. It has experienced rapid changes over the last few years.

The Home Theatre segment continues to grow from 0.30 million units in 2010-11.10 million units. Conventional CRT TV segment on the other hand is stagnant at around 13.8 million units in 2010-11. Growth rate in domestic production of PA System is estimated to remain flat at 10 per cent in 2010-11 over a base of 410 Crore in 2009-10. are the growth drivers in the consumer electronics industry. Declining prices and low penetration levels is responsible for the growth of this segment. Colour Television is the largest contributor.20 million units in 2009-10 to 5. Rapid growth and popularity of the DTH sector is impacting the DVD player market. Production of microwaves oven is estimated to grow by 21.9 per cent in 2009-10. a growth of 5. a growth of 25 per cent. innovative designs and aesthetic looks.2 per cent. Premium products. Exhibit 19: Growth in the Consumer Electronic Industry Consumer Durables Air Conditioner Microwaves Colour Television Washing Machine Refrigerator 40 Growth 20-25% 25% 15-20% 5-10% 5-10% . The market for LCD TV has increased from 1.40 million units in 2010-11.30 million units. This growth is fuelled by the sale of flat panel LCD TVs which is increasing in exponential terms. Consumer electronics is one of the largest segments in the electronics hardware sector in India.5 million units in 2009-10 to 2. Split ACs account for about 64% of sales of ACs (in value terms).400 Crore as against 29.40 per cent.50 per cent over the previous\year.6 per cent to reach 930 Crore in 2010-11 as against a growth of 7. the total production of consumer electronics is estimated to be 33. the growth is much higher at 16.000 Crore in 2009-10. The DVD player market continues to decline from 6. Market size for colour television in 2010-11 is expected to be 16. In value terms. a growth of about 15.During 2010-11.24 million units in 2009-10 to 0. particularly in the metros. The air conditioner (AC) market has seen steady growth with a strong preference for split AC units over window AC units. In this segment.products and devices that come with smart technology.

According to iSuppli corporation (Applied Market intelligence). the market of color television will grow at a compounded annual growth rate (CAGR) of 9%.5 million sets per annum.Black and White Television Clock Watch VCD Consumer Electronics (overall) -20% 10% 10% 30% 9% Exhibit 20: Consumer Electronics Production Profile Colour Television Market in India Overview The CTV market is estimated at 6. 41 .

color television sales will grow at a rate of 9. Projected Sales Exhibit 22 :Projected Market Sales for Television Industry 42 .Major Players The major players in the color television segment are: • • • • Sony India Samsung India Videocon Onida Projected market growth Exhibit 21: Projected market Growth for television industry According to iSuppli corporation (Applied Market intelligence).6%.

Products covered The products covered under the color television segment are: • • • • Flat-panel LCD plasma Regular 21-inch CRT (cathode ray tube) or a small set 29-inch flat-screen CRT TVs Growth Drivers Some of the growth drivers because of which CTV market is growing fast are: • • Increased awareness Increase in disposable income 43 .

• • • Emergence of nuclear families Rising availability Declining prices Many MNC and domestic companies are now making India as a manufacturing centre because: • • • • • Low cost skilled labor Tax free zones i. SEZs Qualified workforce Untapped domestic market Excellent supply base for glass and color picture tubes Barriers to Entry Some of the major barriers before the companies who want to make an entry into the market are: • • Poor government spending on rural and small town electrification program Poor distribution network Refrigerator Market in India 44 .e.

Refrigerators hold only 16% of consumer durable market that is valued at around Rs.000 crore in India.000-25. Major Players Some of the major players in the refrigerator category are: • • • • Whirlpool Kelvinator Samsung Siemens Projected sales for the year 2007-2008 Exhibit 23: Projected sales of refrigerator 45 . 20.Overview Indian refrigerator market is valued at Rs 4000 crore. Its market is growing at the rate of 7-8% annually.

Whirlpool is also launching new range called Mastermind in capacity of 220 litres. Whirlpool's new product target is the consumers with requirements of not very big capacities. • LG will focus on marketing its new model viz. over 230 litres direct cool refrigerators.e.Focus areas in 2007 Keeping summers in mind and with the motive of "Beat the Heat. Green Ion Door-Cooling Refrigerators. Samsung is planning to launch 9 new models in both direct cool and frost free categories." the refrigerator companies are now focusing on high-end frost free and large capacity i. • • Challenges faced by the companies in refrigerator segment Despite the fact that refrigerators have immense utility to housewives and provide a solution to avoid food wastage. This may be because: 46 . 250 litres and 280 litres. which emphasizes health-related features and technologies. the penetration level is still below 20% and its market is growing at a very small pace.

LG will soon be featuring Abhishek Bachchan and will run a 360 degree media plan. 1500 crore and is growing at the rate of 22% this year (2007-08) compared to 2006-07. Washing machine sales is cyclical in nature and its sales commences with the onset of monsoon. For example. Videocon Samsung LG is the leader with 27% of market share. Washing Machine Market in India Overview The washing machine market is valued at Rs.• People in small towns and rural areas do not consider it as a necessary product and are unaware of its utility value. The fully automatic and semi-automatic sub category is growing at the rate of 40% and 17% respectively. Whirlpool has a market share of 17%. Non-availability of power. Samsung has a market share of 14%. Companies are investing a lot for in-depth marketing through various promotional activities and advertising campaigns. Major Players Some of the major players in the category of washing machine market are: • • • • • • • Whirlpool LG Electronics India Ltd. 47 . • But the companies are leaving no stone unturned. Whirlpool is involving Ajay and Kajol Devgan as its brand ambassadors to increase the sales figure.

Products covered • • • • Fully automatic machines Semi-automatic machines Front loading washer Top loading washer Demand Drivers in Consumer Electronics Sector Some of the factors that are responsible for the growth in washing machine segment are: • Increase in disposable income • rapid urbanization. increase in nuclear families • increasing number of working women • growth in per capita income • greater variety of choices • increasing consumerism 48 .

Equipped with the latest user friendly technology and smart functioning features the microwaves manufactured by the top brands in India are among the most popular consumer durable products presently. But over the last few years there has been a tremendous growth in the sales of microwave ovens in India. Also termed as wonder devices the introduction of microwaves has lessened the burden of cooking specially for working women in India.000-crore consumer durable market in India microwave ovens are said to be the fastest growing. The Indian market is flooded with some of the finest microwave brands both national and international. These brands are designed keeping in mind the requirements of Indian consumers.Microwave Market in India Overview Recently launched in India the microwave oven is among the fastest moving consumer durable product today. Together they are responsible for holding a total market share of about 61 per cent. Out of the 25. LG has been the undisputed leader for almost 3 successive years with a market 49 . Initially the concept of the microwave oven was not very well welcomed by the Indian masses. Major Players Top Microwave oven Brands in India include LG Electronics and Samsung India IFB and Kensta. Initially when the product was launched it took some time to gain a foothold in the market but with the changing lifestyles of Indian the product started finding its way into more and more Indian homes.

This is the most expensive AC brand in India.5 per cent of the total market share. Due to its climatic conditions India is racing up the ladder in terms of air condition users. Apart from these major brands there are a host of other electronic brand companies in India that are trying hard to make a mark in the consumer durable market in the country. noiseless functioning and longitivity of the compressor and condenser. The Top AC Brands in India are Electrolux. Voltas.8 per and Kenstar holds a market share of 9. Counted among the most reliable and trusted air conditioning brands in India these two electronics manufacturing companies are best 50 . quick cooling. all the top brands are continuously introducing new models that are equipped with the latest features.share of 41. Panasonic. Electrolux air conditioners top the chart as far as market reviews are concerned. There are numerous AC brands in India that offer a sea of choices at absolutely affordable prices. With the increase in industrialization and the subsequent growth of the middle classes luxury commodities are finding their way into almost every Indian home. Samsung. The scorching summers in India have become unbearable and the fan no longer seems to solve the problem. The microwave oven category in India has shown growth of almost 85% in November 2010 as compared to the same period last year. These brands collectively account for about 1. LG.5 per cent in 2010 followed by Samsung. the advanced EER air conditioners and the environment friendly ones. Due to the increasing competition in the air conditioning market in India. and Godrej etc. energy efficiency and high cooling capacities Air conditioners by Carrier are known for being environment friendly and extreme quick cooling properties. Air Conditioner Market in India With the effects of globalization AC's or air conditioners in India are soon becoming a necessity commodity. Considering the intense competition between the major players in the consumer durables industry the microwave from a relatively embryonic size has blossomed into a full fledged market.5 per cent. Whirlpool. The latest features that are driving the nation crazy are the fragrance emitting air conditioners. Samsung and LG are also among the top AC brands in India. IFB stands third with a market share of 9. Most of the AC's introduced by these companies are known for advanced EER's (Energy Efficiency Ratio). They are known for their sleek and contemporary designs.

In value terms. 2600 crore (US$ 565 million) during the year 2008. Both these companies together launched about 80 new AC models in 2009. Domestic players like Voltas and Godrej are also not far behind. Indian Export of Consumer Electronics EXPORT OF CONSUMER ELECTRONIC GOODS Export of consumer electronic goods registered a growth of 62.84 percent in US$ terms). Annual average growth in export consumer electronics goods from India during the past five years is estimated to be 25.40 percent in US$ terms) during the year 2008-09 over the year 2007-08. Exhibit 24: Growth in Exports of Consumer Electronics MAJOR ITEMS OF CONSUMER ELECTRONICS EXPORT DURING THE YEAR 51 . They too have made a formidable presence in the air conditioning market in India over the years.80 percent (25.09. export of consumer electronics goods increased from Rs.known for their good quality air conditioners at absolute competitive rates.50 percent (42. 1600 crore (US$ 397 million) estimated in the year 2007-08 to Rs.

1095.45 million) estimated in 2007-08 to Rs. The other major items of export during 2008-09 have been P A Systems. In value terms export of consumer electronics to Singapore. 956 crore (US$ 208 million) during the year 2008-09. Far East and EU countries registered decline during the year 2008-09. 307 crore (US$ 76 million) estimated in the year 2007-08. 99 percent of the recorded video tapes of educational nature and news/views were exported to Hong Kong. Export of Television sets is estimated to Rs. CD/DVD.38 crore (US$ 213 million). 30 crore (US$ 7. MAJOR DESTINATIONS OF CONSUMER ELECTRONICS EXPORTS Singapore. Middle East countries now stand at 4th position during 2008-09. Hong Kong and other South Asian countries emerged as the top destinations for India’s consumer electronics exports during the year 2008-09.8 percent (79 percent in US$ terms) during 2008-09.5 million) estimated in 2007-08 to Rs. 1139 crore (US$ 247 million) during 2008-09 up from Rs.65 crore (US$ 238 million). Export to CIS countries. 978. In value terms export of recorded video tapes of educational nature and news/views during 2008-09 is estimated to be Rs. 52 . Export to this region registered a growth of 217. Export to North America increased from Rs.High growth in Export of recorded video tapes of educational nature and news/views has resulted this item to become the second top item of exports under consumer electronics during the year 2008-09. Hong Kong and other South Asian countries increased from Rs. 308 crore (US$ 76.Television sets remains India’s top item of export under Consumer Electronics sector during the year 2008-09 as well. Calculators and Two in ones. Export to North America and EU countries also registered a high growth during the year 200809. Middle East countries which was the top destination for Consumer electronics exports from India since the year 2000 registered a steep decline of 75. Cassettes.66 percent (178 percent in US$ terms) during the year 200809 over the year 2007-08.

driven by consumer demographic trends. Taiwan. Corporate Catalyst India A report on Indian Electronics Industry Some of the key trends that have a positive impact on the sector are: • Growing consuming class (defined as people having annual income of US$ 980 (INR 53 . Favorable Demand Conditions for Growth India has been experiencing a strong growth in the demand of consumer products and durables in recent years. etc. Malaysia.Key Success Factors and Risk Factors for Consumer Electronic Industry Key Success Factors • • • • Ability to offer innovative products Keeping abreast with technological changes Local and efficient manufacturing to educe cost Effective regional distribution model Key Risk Factors • Competition • Large number of well established Indian and MNC companies • Overcapacities in China. This has facilitated growth in the electronics sector both directly and indirectly.

Russia. India has the youngest population amongst the major countries. has placed orders for more than 350 aircrafts with a list price of about US$ 26 billion. only 28 per cent of the urban households possessed a refrigerator. VCD / MP3 players and PCs directly benefits the sector. On the whole the domestic market in India is very attractive from the point of view of the electronics sector. white goods.thirds of its population is below the age of 35. air-conditioners. And there are 6million rich households in India. etc. • Increased government and private industry spending on sectors such as defence and aerospace. Samsung has selected India as one of the top six strategic markets in the world along with the US. leads to growth in the electronics sector as these products contain a significant number of electronic components.US$ 21. in 2002.800 a year. For example. India is the 4th largest economy in the world and is expected to overtake Japan in the near future to become the 3rd largest. China. Indian consumer goods market is expected to reach $400 billion by 2010.45000 or above) that has greater disposable income and propensity to spend. consumer demand has boosted growth in India’s overall manufacturing sector as well. only 16 million computers were used in India in March 2005.Rural sector offers huge scope for 54 .6 million in 2000. The Indian aviation sector. Nearly two. There are a lot of young people in India in different income categories. There are 56million people in middle class. and current trends indicate high growth potential for the sector in the future. The upper-middle and high-income households in urban areas are expected to grow to 38. has a positive impact on industrial electronics. and nearly 50 % is below 25. Also the demand for products such as automobiles. Despite a population of more than 1 billion people.2 million in 2007 as against 14. At the same time. textiles. who are earning US$ 4. • In recognition of India’s domestic market potential.400. Germany and Thailand. for example. Scope In terms of Purchasing Power Parity (PPP). It has been estimated by NCAER that this group will constitute over 80 per cent of the population of India by 2009-10 • Lifestyle changes such as greater exposure to global trends and increasing affinity for convenience and lifestyle products • Increasing urbanisation. Growth in demand of consumer durables such as CTVs. in turn. only 66 per cent of middle-income households had a TV set. while just a little over 15 per cent owned an air cooler. emergence of nuclear double income families • Low penetration levels of most consumer durables. which.

The bottom line is that Indian market is changing rapidly and is showing unprecedented business opportunity. as it accounts for 70% of the Indian population. The urban market and the rural market are growing at the annual rates of 7%-10%and 25% respectively. Rural areas have the penetration level of only 2% and 0. The rural market is growing faster than the urban market.consumer durables industry. The urban market has now largely become a product replacement market.5% for refrigerators and washing machines respectively. CHAPTER 4 MAJOR PLAYERS IN THE INDIAN CONSUMER ELECTRONICS MARKET 55 .

The group has 17 manufacturing sites in India and plants in China. It has in house compressor manufacturing technology for refrigerators . selling them through their sales and service network in India. LCD. Display industry and its components: By acquiring Thomson SA’s colour picture-tube manufacturing business which is spread across China. refrigerators. Poland. washing machines. with the acquisition of Thomson displays by Videocon in Poland. and Mexico.Major Players in Consumer Electronics Market in India Major Domestic Player: Videocon India (current market share-12%) Videocon is an industrial conglomerate with interests all over the world and based in India. Also. air conditioners. The company operates in four key sectors:Consumer Electronics. plasma. and Mexico. It is also the third largest picture tube manufacturer in the world. china. the company is marking its international presence. Poland. Home Appliances & Compressor manufacturing: It produces consumer products like colour televisions. Italy and Mexico. and other 56 . Videocon is able to improve the technology in existing products in slim tube. microwave ovens and many other home appliances. The group emerges as a USD 4 billion global conglomerate continuing to set trends in every sphere of activities Videocon's extensions Videocon has acquired Electrolux brand in India.

and slim CRT display products. flat. BPL used its manufacturing strengths and strong technical tie up with Sanyo of Japan to launch the BPL brand televisions in the Indian market. Within a span of five years. Bharat Energy Ventures. The company operates subsidiaries namely BPL Display Devices. BPL established its image as a reliable and strong brand in the consumer durables market. superior quality. With the increasing nationwide infrastructure development in power and telecommunication. a reputation that it still enjoys. consistent dedication to customer satisfaction and unparalleled standards of service. BPL ventured into this field with its Power Line Communications Carrier (PLCC) and continues to be a leader in this field.flat-panel display lines as well as create new innovative products. BPL has exemplified the quest for excellence in the world of medical products becoming the country’s foremost in manufacturing electrocardiographs. In India. With the advent of televisions in India. Oil and Gas: An important asset for the group is its Ravva oil field with one of the lowest operating costs in the world producing 50. digital concepts and personalized service that has ensured loyal customers and nationwide acclaim in the industry. BPL LIMITED The company was established as a single product company manufacturing high precision hermetically sealed panel meters for defence applications. Products • Mobile Products 57 . The group has ambitious plans for expansion in this sector globally. and BPL Securities.000 barrels of oil per day. Videocon produces a superior range of panels and funnels to meet the demand for large-size. Colour Picture Tube Glass: Videocon is one of the largest Colour Picture Tube (CPT) glass manufacturers in the world with a high level of experience and technical expertise operating through Poland and India. With relentless commitment to quality. BPL is recognized as a benchmark for new age technology. BPL has its footprint across the country through a distribution network comprising of over 7000 channel partners.

gynaecology. imaging. mini EPABX systems. which includes healthcare products caters various segments such as cardiology.G. mobile phone. 208 Customer Relation Center's and 41 depots spread across the country. MIRC Electronics shares are listed on the National Stock Exchanges and Bombay Stock Exchanges. Companies are marketed in big hypermarkets like Lu Lu Centres. The company also has sales and marketing office in Dubai. Products • • • • • LCD TV Television DVD and Home Theatres Air Conditioning Washing Machine 58 . Company produces single colour television in 12 seconds and has manufacturing capacity of 1. Geants and Dasmans in GCC countries.Mirchandani and Mr. moulding MIRC Electronics Mirc Electronics incorporated in 1981 is engaged in manufacturing and marketing of LCD TV. Tanzania. microwave oven and projectors and display products. washing machine. oxyenators.L. Today the company has network of 33 branch offices. DVD and home theatres. Carrefours. DKX series of telephone systems and convex voice processing system. home UPS. Medical systems. Energy communications equipments Other products include engineering design and tool room. Company’s manufacturing plant is located at Thane. Kenya and Ethiopia and SAARC countries. digital switches.• • • • • • • • Landline Phones Home Theatre Television Household products that includes products for home lighting. Mirc Electronics exports its products to Uganda. nebulisers and welch allyn range.Vijay Mansukhani. Enterprise communication products include communication solutions. patient monitoring systems. air conditioner. Noida and Roorkee. Company markets its products under the brand name ‘ONIDA’. The company was founded by Mr. gas tables and cooking hubs.2 million sets in a year.

deep freezers etc and provides commercial refrigeration solution to multiplexes. electro-mechanical projects. container handling equipment. water management. materials handling. ventilation and air conditioning) and refrigeration solutions. New Zealand. institutional and the home segment. water coolers. refrigeration. commercial. It has the largest customer base in industrial. Qatar. mining and construction equipment. Voltas has executed projects in more than 30 countries worldwide. is one of India’s leading conditioning and engineering service provider. It provides a wide range of solutions to various industries in areas of heating. Ethiopia. Kenya. Chemicals trading It is the oldest division of Voltas operating for more than 45 years. mechanical. HVAC (heating. machine tools. Unitary Cooling Products It manufacturers a wide range of cooling appliances such as air conditioners. Business Electro-mechanical Projects and Services Under this it provides a wide range of electrical.2 brand in the air conditioner segment with a market share of 16%. mining and construction equipment. commercial complexes and luxury liners. indoor air quality and chemicals. Saudi Arabia. Voltas has a presence in Oman. textile machinery.• • • Mobile Phones Microwave Oven Projectors and Display Product VOLTAS Limited Voltas. Engineering Products and Services In this segment it manufactures textile machinery. machine tools and material handling products such as forklift trucks. 59 . The company belongs to the Tata Group. etc. ventilation and air conditioning. It also provides water management and treatment. It is leader in the water cooler segment in India. building management systems. It is leader in commercial freezers and coolers in India. incorporated in 1954. Recognition It is India’s no. Libya and Mauritius among others.

Samsung India which commenced its operations in India in December 1995. right from its inception in 1911 as first commercial manufacturer of motorized washers to the current market position of being world's number one manufacturer and marketer of major home appliances. The parent company is headquartered at Benton Harbor. Samsung ‘Made in India’ products like Colour Televisions.Major International Players SAMSUNG India (current market share-37%) Samsung India is the hub for Samsung’s South West Asia Regional operations. Today. Colour Monitors. Whirlpool of India Ltd. Whirlpool. Laden and Ignis. Headquartered in New Delhi. Bauknecht. The South West Asia Regional Headquarters looks after the Samsung business in Nepal. today enjoys a sales turnover of over US$ 1Bn in just a decade of operations in the country. with around 18% of its employees working in Research & Development. Estate. 60 . Michigan. CIS and SAARC countries from its Noida manufacturing complex. Whirlpool is the most recognized brand in home appliances in India and holds a market share of over 25%. Roper. Colour Monitors and Refrigerators are being exported to Middle East. Maldives and Bhutan besides India. Sri Lanka. USA with a global presence in over 170 countries and manufacturing operation in 13 countries with 11 major brand names such as Whirlpool. has always set industry milestones and benchmarks. Samsung India has a network of 19 Branch Offices located all over the country. Bangladesh. The Samsung manufacturing complex housing manufacturing facilities for Colour Televisions. near Delhi. KitchenAid. Refrigerators and Washing Machines is located at Noida. Samsung India currently employs over 1600 employees.

LGEIL's manufacturing unit at Greater Noida is one of the most eco-friendly units among all LG manufacturing plants in the world. South Korea was established in January 1997 in India. It is one of the most formidable brands in consumer electronics. The same year also saw acquisition of major share in TVS joint venture and later in 1996.The company boasts of resources and capabilities beyond achievable feat of any other in the industry. LGEIL has achieved a turnover of Rs 8250 crore in 2006. microwave ovens and air conditioners. a wholly owned subsidiary of LG Electronics. The second Greenfield facility is located at Ranjangaon.. Whirlpool India. It forayed into the market under a joint venture with TVS group and established the first Whirlpool manufacturing facility in Pondicherry. Ltd. home appliances. IT hardware and mobile communications space. Product range of the company includes: • • • • • • Refrigerator Washing Machine Air Conditioner Microwave 100% Dryers Purafresh LG Electronics India Pvt Ltd 23%) (current market share- LG Electronics India Pvt. Colour Televisions. Kelvinator and TVS acquisitions were merged to create Indian home appliance leader of the future. Microwave Ovens. This encouraging trend brought the company to India in the late 1980s. it emerged as truly global leader in the1980s. Pune has the capacity to manufacture GSM Phones. refrigerator. In India for a decade now. This expanded the company's portfolio in the Indian subcontinent to washing machines. Whirlpool initiated its international expansion in 1958 by entering Brazil. However. LG has earned a premium brand positioning and is the acknowledged trendsetter for the industry. Soon Whirlpool acquired Kelvinator India Limited in 1995 and marked an entry into Indian refrigerator market as well. This is India's first mobile phone manufacturing unit and also Asia's largest Optical Disc Drive manufacturing plant. and recognised as a leading technology innovator in the information technology and mobile 61 . refrigerators and Optical Disc Drives. it is the market leader in comsumer durables. In India for a decade.

215 Sony World and Sony Exclusiveoutlets and 21 direct branch locations. The company also has presence across the country with 21company owned and 172 authorized service centres. Japan. Middle East and few more countries globally. incorporated in 1984. It also manufactures fully automatic machines. It is the acknowledged trendsetter for the consumer durable industry in India with the fastest ever nationwide reach. which exports to SAARC. split AC. the company's manufacturing unit are located at Kadi (Gujarat) and Jammu. 62 . Headquartered in Ahmedabad (Gujarat). Sony India (current market share-21-22%) Sony Corporation. is a subsidiary of Hitachi Home & Life Solutions Inc.communications business. Products Air-Conditioning. Japan.The company produces range of products such as window ACs. The company is among the leading air-conditioning companies in India. is engaged in manufacturing a range of electronic home solutions.In India.000 units a year. latest global technology and product innovation. HITACHI Home & Life Solutions (India) Ltd Hitachi Home and Life Solutions (India). 250 sales and service dealers. The company has installed capacity of 250. established its India operations in November 1994. tower and packaged air conditioners Hitachi manufactures 2. Sony has itsdistribution network comprising of over 7000 channel partners.and 3-door refrigerators. more than 800 showroom dealers and 350 service points. Hitachi Home and Life Solutions (India). Hitachi Home & Life has a marketing network of 18 branches. popularly known as Hitachi.

In the year 2007. microwave ovens and dishwashers. During the same year. The company has recently launched its brand of mobile phones in India. The company has got a dealer network of more than 1600 dealers all over the country. Haier Appliances India entered in to a JV with Sanyo of Japan in order to expand its business in Asia by selling its refrigerators under the Sanyo brand. the company also acquired Anchor Daewoo’s Appliance business which included a refrigerator manufacturing unit at Ranjangaon in Pune. 63 . 25 warehouses and over 4. The group manufactures home appliances in over 15.000 retail outlets. In Aug 2004 the company made an all-India promotional launch of over 55 products across six different product categories which comprised of refrigerators. colour television/DVDs. The Haier Group was incorporated in 1984 in China.100 different specifications under 96 categories. Haier Appliances India has got its presence in all the major cities of the country. washing machines. The company has a strong network that comprises of 18 branch offices.Haier Appliances (India) Private Limited Haier Appliances (India) Pvt Ltd ((Haier Appliances India) is a wholly-owned subsidiary of Haier Group. Haier Appliances India started its operations in India in Dec 2003.

CHAPTER 5 SWOT ANALYSIS ON CONSUMER ELECTRONIC INDUSTRY IN INDIA 64 .

SWOT ANALYSIS
STRENGTHS:
1. Presence of established distribution networks in both urban and rural areas 2. Presence of well-known brands: A large no. of well known brands like Samsung,LG,Sony,Hitachi,Videocon etc, are present in the Indian market. Thus making the market highly potential for customers. In recognition of India’s domestic market potential, Samsung has selected India as one of the top six strategic markets in the world along with the US, China, Russia, Germany and Thailand. 3. In recent years, organized sector has increased its share in the market Vis a Vis the unorganized sector. 4. Abundant Availability of Man Power: India produces over 500 PhDs, 200,000 engineers, 300,000 non-engineering postgraduates and 2,100,000 other graduates each year. India’s capabilities in IT and engineering make it an attractive location for sourcing engineering services such as Research & Development (R&D) and design. 5. Competitive Labour Costs: India’s cost of skilled labour is among the lowest in the world. For example, average labour rate per employee in the electronics sector is about $3,000 per year. Labour cost as a percentage of value added is only 21 per cent in India as compared to 23 per cent in China and 30 per cent in Taiwan. Taking advantage of this many MNCs have set up manufacturing bases in India for domestic consumption as well as exports

65

WEAKNESSES
1. Demand is seasonal and is high during festive season 2. Low purchasing power of consumers 3. Lack of clear-cut government policy for the industry. 6. Very little expenditure in Research and Development area: The Indian companies do not spend more on the R&D area, thus making the market obsolete. 5. Heavy Taxation: Heavy taxation in the country is one of the hurdles for the players. At its present structure the total tax incidence in India even now stands at around 25-30 per cent, whereas the corresponding tariffs in other Asian countries are between 7 and 17 per cent. 6. Poor Infrastructure: Poor infrastructure is another reason that seems to have held back the industry. Regular power supply is imperative for any consumer electronics product. But that remains a major hiccup in India

66

OPPORTUNITIES
1. Penetration Level: In India, the penetration level of white goods is lower as compared to other developing countries. For example, in 2002, only 66 percent of middle-income households had a TV set, only 28 per cent of the urban households possessed a refrigerator, while just a little over 15 per cent owned an air cooler. 2. Rise in disposable income: The demand for consumer electronics has been rising with the increase in disposable income coupled with more and more consumers falling under the double income families. The growing Indian middle class is an attraction for companies who are out there to woo them. 3. Availability of newer variants of a product: Consumers are spoilt for choice when it comes to choosing products. Newer variants of a product will help a company in getting the attention of consumers who look for innovation in products. 4. Potential markets remaining yet untapped: A large segment of the domestic market, mostly the rural market is yet to be tapped. Tapping this yet untapped and unorganised market is a major opportunity for the Indian consumer durables sector. 5. Availability of financing schemes: Availability of credit and the structure of the loan determine the affordability of the product. Sale of a particular product is determined by the cost of credit as much as the flexibility of the scheme. 6. Rise in the share of organized retail: Rise in organized retail will set the growth pace of the Indian consumer durables industry. According to a working paper released by the Indian Council form Research on International Economic Relations (ICRIER), organized retail which constituted a mere four percent of the retail sector in FY07 is likely to grow at 45-50% per annum and quadruple its share in the total retail pie 16% by 2011-2012. The share will grow with bigger players entering the market.

THREATS
67

Rivalry and competition: Presence of a large number of players in the domestic consumer durables industry leads to competition and rivalry among companies. Cheap imports from Singapore. Threat from new entrants. especially from global ones who have technologically advanced products to offer. 2. 68 . Threat from substitute products/services: The domestic consumer durables industry is plagued by threats from substitute products. 3. With the advent of a horde of FM radio stations. China and other Asian countries 4. especially global companies: The domestic consumer durables sector faces threat from newer companies. Customer power with respect to availability of choice: The availability of a wide product line on account of most products being homogeneous. Threat from rivalry and competition poses a threat to domestic companies.1. poses a threat for companies operating in the consumer durables sector. Customers have the choice of both domestically produced and imported goods. Easy accessibility to theatres/multiplexes. especially in urban areas has turned off the viewership from TV to a large extent. with similar features. radio sets have now substituted TVs.

CHAPTER 6 SURVEY SURVEY 69 .

Random Sample: The survey was conducted over 50 individuals. LG and Hitachi.e. Purpose of the Questionnaire: To know the market share of different players in the Indian consumer electronic industry. 70 . and respondents are asked to choose among them.The answers to all the questions were suggested for consistency. scale questions. Closed ended questions include all possible answers/prewritten response categories. I have employed structured survey method using questionnaires. interpret what is expected and then write down the answers themselves. multiple choice questions. A questionnaire consists of a set of questions presented to a respondent for answers. The 4 companies selected for the survey were: Videocon. The questionnaire consisted of 4 questions . Samsung. I will use a closeended questionnaire.g.Each question had 4 different choices.Survey Method: In order to find out the market share of different players in the market. The respondents read the questions. and they could be ticked in boxes (multiple choice format).

CHAPTER 7 ANALYSIS AND FINDINGS ANALYSIS AND FINDINGS Exhibit 25: Most Preferred Brand in Consumer Electronics 71 .

Exhibit 26: Most Preferred Brand in Refrigerator market 72 .

Exhibit 27: Most Preferred Brand in Television Market Exhibit 28: Most Preferred Band in Washing Machine Market 73 .

Most Preferred Brand in Microwave Market 74 .

Most Preferred Brand in Air Conditioner Market 75 .

Most Preferred Brand in Mobile Market Most Preferred Brand in Computer/Laptop Market 76 .

77 .

gov. India http://www.in/sites/upload_files/dit/files/annualreport201011.mit.mit.pdf • Electronic Hardware and Component Industry in India-An Overview 78 .REFERENCES • Annual Report 2010-2011 – Department of Information Technology.in/pdf/surveys_reports/electronics-industry.pdf • NSDC Report for Electronic and IT Hardware Sector http://www.pdf • Electronic Industry in India www.asa.gov.in/sites/upload_files/dit/files/Electronics_IT_Hard ware_NSDC_Report_17311.

shine.aspx 79 .shine.net/ghaayathri/consumer-electronics-in-india-ananalysis • http://info.aspx • http://info.aspx • http://info..shine.shine.An Analysis http://www.xing.https://www.com/company/Videocon-AppliancesLimited/904.com/company/Voltas-Limited/903.com/company/Hitachi-Home-Life-Solutions-IndiaLtd/3344./electronics-hardware-and-componentsindustry-in-india-an-overview-13560464/ • Consumer durable industry in India http://www.com/company/Whirlpool-Of-India-Ltd/2028.slideshare.com/doc/49620972/Consumer-Durable-Industry-inIndia • Consumer Electronics in India .aspx • http://info.com/..scribd.

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