The electronics industry in India is estimated to be around 40 billion USD, less than 1% of the global market. It is divided into consumer durables and hi-tech/consumer electronics. The consumer durables industry has grown at a double digit rate in recent years and is projected to grow 65% over the next 5 years. Growth is driven by increasing disposable income and demand from rural India. The logistics market serving the electronics industry is estimated to be between 3600-6000 crore INR currently and is expected to grow to 6000-10000 crore INR by 2014, providing opportunities for logistics providers.

1. Overview of Electronics Industry - India
•The industry is estimated to be close to 40Bn USD and is less than 1% of the global electronics
industry.
2.Hi Tech/Consumer
1.Consumer Durables
Electronics
•High Volume- high •High Volume- high
growth products growth products
•Large appliances like •Televisions including
Refrigerators, Washing LCD and LED
Machines, Air Televisions
Conditioners, •Computers, Laptops
Microwave ovens etc. and computer
•Small appliances like peripherals.
Irons, Mixers, Blenders •Mobile phones and
etc. peripherals.

2. Consumer Durables
Sales of Major Appliances by Volume : ‘000
16,000 Consumer appliances can broadly be classified
14,000 13,404 into two categories, Major appliances and Small
12,000 11,467 appliances. For the purpose of this study we will
10,000 9,337 be focusing on Major appliances.
7,756
8,000 6,725
5,931
6,000
4,000
2,000
Sales of Major Appliances by Value: INR Crore
0
18,000
2005 2006 2007 2008 2009 2010
15,442
16,000
The consumer durables industry has been 14,000 12,857
growing at double digits growth rates over the 12,000 10,480
past few years. The market stands at INR 10,000 8,651
15,442 Crores in the year 2010. As the 8,000 6,382
7,359
disposable income of an average Indian 6,000
increases, the demand for high value 4,000
appliances will increase. Thus the demand for 2,000
a credible logistics player will increase 0
2005 2006 2007 2008 2009 2010
.

3. Consumer Durables – Forecast and Growth Trends
Forecast Sales Volume of Major Appliances : Forecast Revenue of Major Appliances:
‘000 units 30,000 INR Crore 28,450
25,510
30,000
25,000
25,945 22,711
25,000 23,212 20,080
20,000
20,540 17,638
20,000 17,979 15,442
15,571 15,000
15,000 13,404
10,000
10,000
5,000 5,000
0 0
2010 2011 2012 2013 2014 2015 2010 2011 2012 2013 2014 2015
The industry volume is expected to grow by 65% in the next 5 years. Presently 13.4 million units
are being sold and this is projected to grow to 25.9 million units .

4. Consumer Durables : Market Share of Major Players
Market Share of Major Players
100%
90% 17.4 15.2
21 21.1 20.3
80% 9.3
9.7
10.7 10.6 10.1
70% 11.5
11.6
10.4 11.4 12.2 Others
60%
17.9 Videocon
17.1
50% 17.3 17.1 16 Godrej
40% Whirlpool
14.7 19.3 21.1 Samsung India
30% 16.2 18.6
LG India
20%
25.9 23.6 22.8 24.9 25
10%
0%
2006 2007 2008 2009 2010
Many of the major players have product lines in the hi-tech industry. Both LG and Samsung
manufacture mobile phones and LCD TV in India. For the purpose of this study , these
companies have grouped under players in the consumer durables market.

5. Hi Tech Electronics
Sales of Hi Tech Electronics by Volume (mn units)
Sales of Hi Tech Electronics by Value (INR cr)
250
'000
208
120
200 184 105
97
163 100 88
147 81
150
80
64
105
60
100 45
69 39
40
48
50
20
0
0
2004 2005 2006 2007 2008 2009 2010
2004 2005 2006 2007 2008 2009 2010

6. Hi Tech Electronics – Forecast and Growth trends
Forecast Sales Value of Hi Tech Electronics Forecast Sales Volume of Hi Tech Electronics
(mn units) (INR cr) '000
400 200
346 180 172
350
305 160 151
300 268 133
140
250 236 117
208 120 105
200 100
150 80
60
100
40
50 20
0 0
2010 2011 2012 2013 2014 2010 2011 2012 2013 2014
Growth Driven by Rural India
As the purchasing power of rural consumers is growing, they are increasingly becoming more integrated into
the overall economy. 56% of the national income, 64% of expenditure and 33% of savings are accounted for
by rural India. Mobile phones have almost reached saturation level in the major cities and towns, with the
market now focused on replacement demand. Volume growth in the mobile phone sector is thus derived
almost entirely from the huge demand from the rural segment. As well as using mobile phones as a
communication device, villagers are also using them for entertainment purposes, such as listening to music.

7. Estimation of market size for supply chain solutions &
findings
1. From Preliminary analysis and secondary research of industry reports and media reports, the
logistics cost were found to be 3- 5% of the turnover for consumer durables and Hi Tech Industry
, which would range from INR 3600Cr – 6000Cr in 2010 growing to INR6000 Cr- 10000 Cr by
2014.Small Consumer appliance industry has not been considered in this study and this would also
increase the size of the industry.
2. Growth rate forecasted in the electronics manufacturing industry is 13-14% over the next five years
and hence similar growth rate is expected in the logistics industry catering to electronics
manufacturing.
3. The fact that new electronic manufacturing plants (eg. LG,Godrej etc.) are getting
commissioned in different parts of the country presents an opportunity to enter this industry.
4. Entry of the many international logistics providers into the electronic logistics industry signals
attractiveness of the industry from initial analysis.
5. Customer Network optimization using advanced softwares( eg. Supply chain
designer, Transpro, Routepro),consignment real time Tracking services and VMI seem to be some
of the common value added services offered by organized logistic players in the industry.
6. The industry is expected to consolidate over the next few years with organized sector taking over
from the unorganized sector in a big way.