The Indian semiconductor industry market is expected to grow at a CAGR of 13.4 per cent to $7.59 billion by 2010 as against the earlier forecasted CAGR of 26.7 per cent.
An industry report put out by the The India Semiconductor Association (ISA) and Frost and Sullivan (F&S) states that the decline in CAGR, from 26.7 per cent, in the earlier report of 2007, to 13.4 per cent, in the current report, is on account of revised investment and manufacturing scenario seen in the second half of 2008.
There has also been a decline in the Average Selling Price (ASP) for various semiconductor components ranging from 3 to 10 per cent depending on the final product and the semiconductor content. The overall global slowdown had also not been anticipated during the previous report of 2007.
According to the report, the total revenues of the Indian semiconductor market (Total Market - TM) is poised to grow from $5.9 billion in 2008 to $7.59 billion in 2010 at a CAGR of 13.4 per cent. The total market for semiconductors is the total consumption of semiconductors in India, in any form (can be purchased locally, imported as part of Completely Knocked Down or Semi Knocked Down, imported as a complete product), by any source (Sources are directly from semiconductor company offices in India, distributor sales, direct imports etc) and in either currency (US$ or Indian rupee).
The Total Available Market (TAM) revenues are anticipated to climb from $2.53 billion in 2008 to $3.24 billion in 2010 with a CAGR of 13.1 per cent. The Total Available Market is consumption of semiconductors in India by virtue of manufacturing of end-user products in India in addition to consumption through a local purchase order in India.
A spokesperson for ISA said, “India is a story of growth and this is important in such times though growth may be below past projections. The current slowdown will impact manufacturing investment prospects. A low manufacturing index for electronic products leads to higher imports and thus lowers the local potential for semiconductors, their key component.”
Anand Rangachary, managing director, Frost & Sullivan said: “Information technology & office automation, wireless handsets and communications segments are going to define the semiconductor market growth. The semiconductor market growth is expected to be driven by products/ services such as set-top boxes, wireless handsets, the 3G rollout, deployment of WiMAX, notebooks and smart cards. Opportunities exist for semiconductors in LCD TV, digital camera and Storage Flash Memory markets.”
