Indian semiconductor market to touch $36.3 bln by 2015, CAGR of 30%

The Indian semiconductor market is expected to touch $36.3 billion by 2015. This growth would be fueled by increased consumption of electronic equipment in India, which is expected to rise to $363 billion by 2015 from $28.3 billion in 2005 at a CAGR of 29.8%. The semiconductor driven industry is also expected to create over 3.4 million jobs by 2015. These were some of the findings of the India Semiconductor Association (ISA) - Frost and Sullivan report on the Indian semiconductor industry.

Automobile, ITeS dominated M&As in Jan: AEP study

The automobile and IT/ITeS sectors dominated the merger and acquisition deals in the month of January 2006, which saw over 30 mergers and accusations (M&As) taking place, according to an ASSOCHAM Eco Pulse (AEP) analysis. In 31 M&A deals tracked by the AEP, seven each related to the automobile and IT and ITeS, followed by the banking that saw four transactions. Among these, the two most talked about deals were, the $500-million Jet-Sahara (the 2 leading private domestic airlines in India) and $810-million Maxis Communications Berhad-Aircel (Malaysian telecom giant Maxis Communications Berhad taking a major stake of 74% in Aircel, a leading mobile operator in Tamil Nadu, the southern state of India) deals.

(Ref: Financial Express, Feb 10 2006)

IT sector may need $2.6 bln to train 1 mln professionals in 3 yrs

India may need an incremental one million professionals in the next three years to meet its growth targets. This is the estimate given by India’s second largest Indian IT company Infosys Technologies’ Chief Financial Officer, Mohandas Pai. A Business Line report quoted Mr. Pai saying Indian IT and ITES industry will need to spend $2.6 billion to train these people. The Indian IT industry is estimated to employ about 1.3 million people by the end of fiscal year 2005-06.

(Ref: Business Line, Feb 12, 2006)

$100 bln in contract renewals could challenge `Big Six` of outsourcing

The ‘Big Six’ of outsourcing — Accenture, ACS, CSC, EDS, HP, and IBM — could see their dominance challenged. TPI, the leading sourcing advisory firm, said in its latest Quarterly Index. Almost $100 billion worth of major outsourcing contracts are due for renewal internationally in the next two years The Big Six are the incumbent service providers on 72% of the contract value to be renewed. TPI’s analysis reveals that 325 deals are due for renewal during 2006 and 2007, representing over a fifth of active contracts.

(Ref: Business Standard, February 15, 2006)

National Association of Software and Services Companies (NASSCOM), the apex body of the software and services industry in India, has projected a growth of 32% in IT and IT-enabled services exports to $23.4 billion for the fiscal ended 2006. However, this growth is about 6% lower than what was recorded in the financial year 2005. In its key highlights of the Strategic Review 2006, NASSCOM has said the industry was on track for a 30%-32% growth and the final figures were likely to be at the higher end of the estimate for the financial year 2006. Overall the IT industry, including domestic business and the hardware industry, is expected to close the fiscal at $36.3 billion, representing a growth of 28% over the previous fiscal and accounting for 4.8% of the GDP.

(Ref: Financial Express, Feb 10 2006)

The much-hyped sub-10K PC (below Rs. 10,000 or $225) constituted just 2% of the total desktop PC shipments during the July-December 2005 period according to IDC’s Quarterly PC Market report. The IDC report highlighted that Sub Rs. 10k ($225) PCs actually reach the customer at a landed cost of ’sub-Rs 13,000’ ($295) after adding taxes, freight and handling. The overall Indian PC market grew 26% in 2005 to a record 4.3 million shipments during the year. In the Desktop & Notebooks segment, Hewlett Packard retained the top position with a market share of 17%, followed by HCL (13%), and Lenovo at 7%.

(Ref: Financial Express, February 18, 2006)

Telecom Radar

The mobile operators have shown a record net addition of 4.97 million subscribers during January 2006 making it a total of 80.61 million mobile subscribers in India. The mobile addition of 4.97 million consists of 3.52 million GSM and 1.17 million CDMA subscribers. According to the latest report by Telecom Regulatory Authority of India (TRAI), the total subscriber base has reached 130 million with a teledensity of about 12%.

(Ref: Financial Express, February 10, 2006)

CDMA users in India are talking about 40% more than their GSM peers. According to the Telecom Regulatory Authority of India (TRAI), a CDMA subscriber makes 198 minutes of outgoing calls compared to 142 minutes of outgoing calls by an average GSM subscriber. While a GSM user sends 38 SMS and receives incoming calls for 225 minutes in a month, a CDMA user sends 12 SMS and receives incoming calls for 271 minutes in a month. The average monthly revenue per user (ARPU) during the quarter ended September 2005 for GSM mobile operators was $8.45 (Rs 374), while the CDMA operators had an ARPU of $5.5 (Rs 244).

(Ref: Financial Express, February 02, 2006)

Mobile operators such as Idea Cellular, Essar-Hutch, Spice Telecom, MTNL, Tata Teleservices, Internet service providers such as Sify, Hughes Escorts Communication, and Net4India, and utility companies such as GailTel, RailTel and PowerGrid have queued up for national long-distance (NLD) and international long-distance (ILD) licences. The beeline comes after the Department of Telecom (DoT) reduced the entry fee for NLD and ILD services to $560,000 (Rs 2.5 crore). Earlier operators had to pay $22.5 million (Rs 100 crore) for a NLD licence and $5.65 million (Rs 25 crore) for an ILD licence.

(Ref: Business Line, February 21, 2006)