Sunday 23 December 2012

22 Dec, 2012, 02.16PM IST, Indu Nandakumar,ET Bureau Lenovo sees rising competition in a slowing Indian PC market

BANGALORE: India's largest computer seller Lenovo said it expects higher competition from rivals HP and Acer in the coming year, as PC sellers in the country continue to launch aggressively priced devices in an attempt to attract cost conscious consumers.

Lenovo, which is headquartered in China and has a 17% market share in India's PC market, said it will focus on sustaining its present lead in PC's, while at the same time get its

act together to bring out post-PC products such as tablets and ultrabooks. "You can't say with confidence that you will maintain this position. You have to do the right things which can drive the market share," said Rajesh Thadani, head of Lenovo's consumer business in India.

A few weeks ago, HP India head Neelam Dhawan had told ET that she expects HP to regain market leadership.

Close to three million PC units were sold in India in the third quarter of this year, according to market research firm Gartner. On yearly basis, India's PC market declined 5.9% during this period due to decline in consumer buying and an overall decline in economic activity.

US-based HP and Taiwan based Acer have 16% market share in India, followed by Dell that has 12% share. "Clearly it's going to be at a different level," Thadani said referring to competition in the coming year.

Competition, however, feels that Lenovo's emergence as India's top PC vendor in May this year had a lot to do with the bulk order from the Tamil Nadu government to supply free laptops to school children. Prior to that it was India's fourth largest PC vendor behind HP, Acer and Dell.

"Different brands pursue different strategies. Some compromise on profits to win large deals. Acer's focus is having sensible business, without diluting our stated intend for profitability," S Rajendran, marketing head at the Indian arm of Taiwanese-computer Acer.

The Chinese firm, however, defended its position by saying that has seen strong growth even outside the mega deals at a time when the market de-grew 15%. "Large deals are a market reality and anyone who aspires to be a leader will need to be a part of such deals," Lenovo India managing director Amar Babu told ET.

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