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India Information Technology Report Q1 2013

  • Publication Date:January 2013
  • Publisher:Business Monitor
  • Product Type: Report
  • Pages:82
  • ISBN:174592

India Information Technology Report Q1 2013

Includes 3 FREE quarterly updates

BMI View: Indian IT spending is expected to reach US$24.4bn in 2013, up 19%, with government IT
procurements at state and federal level helping to generate spending. Following double-digit growth in
PC sales in H212, BMI expects a continued upwards trajectory in 2013, with IT Services in the
vanguard. India's potentially vast IT market appears set to remain one of the region's growth
opportunities owing to a growing economy and healthy consumer sentiment. Realisation of the market's
long-term potential depends on raising India's low computer penetration and the government's ambitions
to connect the vast rural areas to the outside world. The next layer of tier-3 and tier-4 towns, beyond the
top 75 cities in India, is expected to be the major growth driver for the next few years, due to rising PC
penetration.

Headline Expenditure Projections
Computer Hardware Sales: US$9.7bn in 2012 to US$11.3bn in 2013, +17.0% in US dollar terms.
Forecast in US dollar terms upwardly revised due to analyst modification following a pick-up in unit sales
growth in Q212.

Software Sales: US$2.5bn in 2012 to US$3.1bn in 2013, +25% in US dollar terms. Forecast in US dollar
terms upwardly revised due to macroeconomic factors, with a boost from Windows 8 and stronger
demand for technology from the small and medium-sized enterprise (SME) segment.

IT Services Sales: US$8.1bn in 2012 to US$10.0bn in 2013, +21.0% in US dollar terms. Forecast in US
dollar terms upwardly revised due to analyst modification and macroeconomic factors and a number of
large projects are expected from the government and from other key verticals.

Risk/Reward Ratings: India's score is 42.1 out of 100.0, unchanged from the previous quarter. India still
ranks ninth in our latest Asia RRR table, ahead of Thailand and Vietnam but behind China. The country
achieved a relatively high IT Market score of 52.5, reflecting the potential returns, but its overall rating
was lowered by a Country Structure score of just 15, the joint-second lowest in the region.

Key Trends & Developments.
- In 2013, there are expected to be strong growth opportunities in the next 200-400 smaller cities
in India, where vendors are expanding their retail and distribution presence. Around 45% of new
PCs sold in the Indian market are now shipping outside the top 75 cities. The government's
policy of providing tax breaks and subsidies for hardware manufacturers should help keep prices
down and support growth.
- Healthcare is expected to be another major area of opportunity over BMI's five-year forecast
period, as the government makes healthcare modernisation a key priority. In its 2012-2013 union
budget, the government increased healthcare spending by 14%, to INR307.02bn (US$6.69bn).
The healthcare IT market has more than doubled in the past 10 years, according to estimates, as
healthcare players have realised the potential of IT to drive both service and business efficiency.
- Despite an overall low level of government IT/software spending, government programmes, at
both state and federal level, are likely to become an increasingly important source of IT contracts
over the next few years. At the federal level, programmes such as the five-year e-governance
initiative and smart ID project, will generate more IT investment. Meanwhile, education looms
large in procurements from state governments such as Tamil Nadu.
Executive Summary .. 5
SWOT Analysis .. 7
Indian IT Sector SWOT ...... 7
Indian Telecoms Industry SWOT ...... 8
India Political SWOT . 9
India Economic SWOT ..... 10
India Business Environment SWOT 11
Asia Pacific IT Risk/Reward Ratings ... 12
Table: Asia Pacific IT Risk/Reward Ratings, Q113 ...... 15
Asia Pacific IT Markets Overview 16
IT Penetration 16
IT Growth and Drivers .. 18
Sectors And Verticals .... 20
Market Overview ...... 24
Government Authority ... 24
Background .... 25
Hardware 25
Software .. 31
Services ... 34
End-User Analysis . 37
Industry Developments .. 39
Table: IT Industry Tax ..... 42
Industry Forecast .... 44
Table: India IT Industry - Historical Data And Forecasts (US$mn unless otherwise stated), 2009-2017 ...... 47
Industry Forecast Internet ..... 48
Table: Internet - Historical Data And Forecasts, 2010-2017 ...... 48
Competitive Landscape . 50
Hardware 50
Internet Competitive Landscape ... 51
Table: Regional Broadband Penetration Overview ...... 52
Macroeconomic Forecast ...... 53
Table: India - GDP By Expenditure, Current Prices Breakdown, 2008-2016 ... 55
Company Profiles .... 56
Wipro . 56
Table: IT Service Line Distribution 58
Table: Verticals 59
Table: Geography .... 59
Table: Mergers And Acquisitions .... 59
Table: Customer Size Distribution (TTM) ...... 60
Table: Customer Metrics . 60
Microsoft Corporation ..... 61
Tata Consultancy Services ...... 66
Table: TCS Revenues By Geography, (US$mn) .... 68
IBM .... 69
Country Snapshot ... 74
Table: India's Population By Age Group, 1990-2020 ('000) 75
Table: India's Population By Age Group, 1990-2020 (% of total) ...... 76
Table: India's Key Population Ratios, 1990-2020 77
Table: India's Rural And Urban Population, 1990-2020 ..... 77
BMI Methodology .... 78
How We Generate Our Industry Forecasts .... 78
IT Industry 78
IT Ratings - Methodology 79
Table: IT Business Environment Indicators ... 80
Weighting .. 81
Table: Weighting Of Components ... 81
Sources ..... 81
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