Country's consumer electronics and appliances market is projected to be worth USD 20.6 billion by 2020 on account of factors such as high disposable income, easy consumer financing and organised retail, says a report.
India is also expected to rank fifth in the consumer durables market in the world by 2025, says a joint report by Consumer Electronics and Appliances Manufacturers Association (CEAMA) and consultancy firm EY.
"The Indian market for consumer electronics and appliances is around USD 9.7 billion and has grown at a CAGR of 9.7 per cent over the 2010-2014 period and is poised to reach USD 20.6 billion by 2020," it said.
"While the urban market accounts for the majority share (65 per cent of the total revenue) in the consumer durables sector in India, future growth is expected to be driven by the rural market, as the government increases its focus on rural electrification," the report further said.
At present, the consumer electronics segment constitutes 17 per cent of the total Indian electronic products, which is the third-highest share.
The segment consists of TV, DVD players, Set Top Boxes, home theater systems, MP3 players, audio equipments, digital cameras and household appliances as washing machine, ACs, microwave, refrigerators etc.
According to the report, "Per capita income in India is expected to expand at a CAGR of approximately 6.6 per cent during 2013-19, from USD 1,500 in 2013 to USD 2,200 in 2019".
Moreover, the retailers are also providing easy financing options to the consumers by partnering with the banks.
"Organised retail industry is expected to cover a market share of 15 to 18 per cent by 2020, from around 3 per cent currently and would not only streamline the supply chain but also facilitate increased demand," the report said.
According to CEAMA estimates, the LED/LCD market is expected to grow at around 20 per cent from 2014 till 2020, while refrigerators are expected to grow at around 10 per cent in that period.
Air-conditioners would continue to rise between 6 to 7 per cent between 2014 to 2020, while washing machines are expected to grow up to 9 per cent during the period.
However, Set Tox Boxes would grow fastest on account of digitisation of the cable delivery system.
"The total STB market was 18.4 million units in 2012 and is expected to grow at a CAGR of 28.8 per cent to reach 39.4 million units by 2015... The number of DTH subscriber in India is expected to increase from 73.1 million in December 2014 to 200 million by 2018," it added.
However, the industry is facing challenges such as rising freight cost, infrastructure bottlenecks and under-developed ecosystems, among others.
