The flat panel display (FPD) market in 2016 is estimated at 261 million units, amounting to an estimated revenue generation of USD 100.8 billion worldwide.
Plasma and CRT shipments have fallen to negligible levels, and while OLED TVs are still in the early stages of growth, LCDs dominated with about 260 million units.
This figure is a decrease of 11 percent compared to USD 113.7 billion in 2015 following USD 119.7 billion in 2014. However, as the market picked up in the second half of 2016, demand recovered. As a result, IHS expects the FPD market to reach USD 110.2 billion next year, up 10 percent from this year. The market is expected to continue to grow for the next four years to 2018 (USD 111.7 billion), 2019 (USD 114.7 billion), and 2020 (USD 116.9 billion).
The Indian Market
The Indian LED TV market in 2016 is estimated at10.6 million sets; this includes direct-lit and edge-lit television sets. A parallel unorganized or grey market, primarily being fed by China, continues to thrive, with an estimated additional 0.9–1.5 million sets. The CRT sets are estimated at 2.5 million units, with Videocon dominating at 2 million sets. Onida and SVL also have presence in this segment.
An estimated 70 percent market share of the organized LED segment is contributed by four players. LG, Samsung, and Videocon (including brands Videocon, Sansui, and Philips) are estimated to be in the vicinity of 2 million sets each. Sales by Sony are estimated at 1.5 million sets in 2016. Another 2 million sets are estimated to be sold by Panasonic, Intex, Micromax, and Onida combined. Haier, Mitashi, with Akai and TCL, both having re-launched their respective brands are aggressive. Other brands with considerable presence are T-Series, Abaj, Sanyo, SVL, Beltek, Kodak, Truvision, Skyworth, LeEco, BPL, Vu, Lloyd, Salora, and Oscar. Brands sold at the large family chains including VISE at Vijay Sales, Teknas at Sanket, ADZEN at Adishwar, and Henry at Pai and those sold at modern retail counters as Reconnect at Reliance, and Koryo at Big Bazaar from the Future Group are also popular.
The OE manufacturers’ own brands also have success in the market. These include Weston from Dixon, Daenyx from Noble, Daiwa from Videotex, Wybor and Ego-Vision from MEPL, SVL from SVL group, and Conic from Conic group.
Consumer Electronics and GST. The Indian TV makers find themselves uncompetitive with a continuous flow of imports. As a joint request, CEAMA, has written to the finance ministry to address this in the upcoming goods and services tax (GST)
implementation. The association has proposed that the basic customs duty for about five years be increased from the current rate of 10 percent to 20 percent. This would discourage imports and provide momentum to the Make in India initiative of creating India as the manufacturing powerhouse for electronics and with the vision of making India self-reliant in electronics production by 2020.
The association’s contention is that China has emerged as the world’s largest producer and supplier of manufactured goods and components.
The scale of production is almost 7–10 times as compared to the level of production in the Indian market. For instance, China produces 80 million LED TVs as compared to 10 million produced in India. China has also developed a strong ecosystem of components whereas Indian manufacturers still have to import a lot of their components. Besides, Indian manufacturers also suffer from various disability factors such as higher freight cost, interest cost, and electricity cost. In the last
few months, China has also devalued its currency by almost 12 percent. All these factors render Indian manufacturers uncompetitive. With government support, it is anticipated that within 4–5 years the Indian industry will become globally competitive and meet not only domestic requirement but also international demand.
The association has also recommended that in the backdrop of the GST bill announcement, units in excise-free zones be reimbursed from the annual budgets of
the Center and the States – 9 percent gross CGST paid by units set up in excise-free zones be provided as refund. In Uttrakhand, for example, since the government supports outright exemptions (on value-add and MRP differential), customers have a benefit to buy from excise-free zones and import is expensive. Post-GST, the manufacturing in excise-free zones will become non-viable and imports more affordable; the recommendation is to increase the import customs duty on finished goods to negate the impact of supply chain disability of the
industry with respect to China.
Also, there is indication that some products will be placed in the luxury category and thereby attract GST of 28 percent. CEAMA maintains that LED TVs have now become items of necessity for the common man and are no more items of luxury. Also, currently manufacturers pay an effective excise duty of 8 percent (12.36 percent excise duty/CVD with an abatement of 65 percent on MRP) and VAT of 12–14 percent, bringing the total
duty being paid between 20 and 22 percent. In the case of GST regime, if the rate is higher than 18 percent it will lead to a huge price increase and unnecessary burden for the common man.
The ceaseless demand for smartphones, demand for high-quality television, and demand for monitors in automotive are some of the major factors driving the FPD market. Furthermore, the presence of some top-notch product manufacturers in countries, such as China, Korea, Japan, and Taiwan in APAC, will boost the growth of this regional market.
On the basis of application, consumer electronics, automotive application, and others are the segments of this market. The others segment includes defense and military, and healthcare. Consumer electronics is currently the largest application; the segment held a share of more than 70 percent in the overall market and is expected to display the fastest CAGR of more than 15 percent between 2016 and 2020.
Consumer electronics is followed by automotive and is expected to display more than 7.5 percent CAGR between 2016 and 2020. Technological advancements in the electronics and semiconductor industry and increasing use of FPD for consumer electronics such as televisions, tablets, smartphones, and laptops are driving the consumer electronics application segment of the market.