With more consumers transitioning to LCD, after posting declines in Q2 and Q3, the overall LCD TV market grew 18 percent in Q4 2015 to reach 2.6 million units. This is against a backdrop where in Q4 2015, emerging markets as Ukraine, Russia, and Brazil fell by 66, 48, and 18 percent respectively. This trend may continue, with Q1 and Q2 2016 receiving impetus from ICC World Twenty20 and IPLT20 matches. Vedanta Group’s LCD screen plant, scheduled to start production in 2018, shall contribute to steady penetration in this segment.
A dip-stick survey of dealers across the industry reveals an excited retailer, expecting an upsurge in demand. With summer becoming more pronounced, sales of air conditioners and refrigerators are expected to be brisk.
Demand is expected to also emanate from the Tier-3, semi-urban, and rural areas. With a clear mandate of the central government for electrifying and providing connectivity to all households in the remaining 18,452 villages, and the pan-India cable TV digitization process in full swing, this decade may well place the Indian consumer at par with his international counterpart.
The recently announced FDI guidelines in retail e-commerce, with 100 percent FDI permitted under automatic route in the marketplace model of e-commerce, is expected to create a level playing field between online and offline retailers. The clarity will also pave way for new foreign investors and global e-commerce firms that have not yet entered the Indian market.
The Indian electronics and hardware industry is expected to grow at a CAGR of 13 percent–16 percent during 2015–2018 to reach about `800,000 crore by 2018 from the current level of `480,000 crore, according to a recent ASSOCHAM-EY study. The Make in India initiative, combined with global manufacturers looking to relocate their manufacturing base from China to alternate locations such as India, Vietnam, and Indonesia due to mounting labor costs, provides a strong impetus to the Indian electronics and hardware industry. It presents an opportunity to become a manufacturing-led sector from being predominantly consumption-driven. To ensure that this momentum keeps pace, the industry and the government need to work together and make the Indian electronics industry highly competitive.