IT marketeer firms suffer heavy losses

The information technology (IT) industry in Gujarat has suffered heavy losses with business in south Gujarat coming to a halt due to heavy rains continuing since past one week.

Sales continue to be disrupted as Ahmedabad, Vadodara, Vapi, Bharuch, Ankleshwar and Surat, are still water-logged. Industry sources claimed that losses in Bharuch and Ankleshwar are estimated at around Rs one crore.

Jwalant Shroff, president, South Gujarat Information Technology Association, said, "The business has come to a standstill since the last seven days as persistent rain across western India has led to heavy losses for the IT market and reseller community.

Explaining further, Shroff said that transportation and communication link remains cut off from the rest of the state and the country, resulting in no new business transactions taking place since past one week.

Hiten Shah, ex-president of South Gujarat Information Technology Association, said that many warehouses in low-lying areas were submerged leading to major losses.

Meanwhile, there are a lot of upgradation opportunities during this season, Shah added.

Mahesh Kalawala, branch manager, Xenitis Infotech Pvt Ltd, said, "The market scene is not good and continuing rains will affect 30 per cent of sales. Heavy rains will affect the dealers more as this being the beginning of academic session, many schools and students make purchases."

On the other hand, Aviv Divekar, head-Astech Informatics in Ahmedabad, said, "IT market is expecting a boost in sales as a lot of replacement work will come up in the monsoon season. Maximum sales have been seen in the assembled parts segment. Due to rains, we are banking a lot on product replacement."

Generally, the market goes up during this time, but there has been a lot of fluctuation recently and we expect a stable market in the next one week, he added.

Industry experts said that Ahmedabad and Vadodara are the worst-affected centers as a majority of the distributors and stockists are based in these two cities.

Nearly 20-25 per cent distributors, having underground godowns, suffered heavy losses.

Dealers have expressed fears that if the situation continues, losses would rise multifold.