Market Research Report : Personal computer market in china 2012

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Personal Computer Market – China

January 2012

2PERSONAL COMPUTER MARKET IN CHINA 2012.PPT

SAMPLE

Executive Summary

Market

Drivers & Challenges

Competition

PC market in China has been demonstrating rapid growth and development over the past few years

China’s PC market will continue to exhibit speedy growth with sales volume growth of ~x % CAGR from 20‐‐ to 20‐‐

Trends

Miniaturization

Rising popularity of tablet PCs

Emerging netbooks

PC vendors move towards smartphones

Drivers:‐ Increasing internet usage ‐ Huge consumer base‐ Rising income‐ Accelerating urbanization and changing lifestyle‐ Untapped market potential‐ Growing consumer goods retailing‐ Growing online retailing ‐ Growing computer education

Government Initiatives

Promotion of broadband and home appliances

Promotion of E‐government and public cultural service system

Increase education level in rural areas

Challenges:

‐ Rise in use of smartphones

‐ Rapid technology obsolescence

‐ Rapid price drops and low profit margins

‐ Challenges in overseas expansion

‐ Low IT spending

International players like Company 1 and Company 2 are boosting their investment in China, indicating tougher and more fierce competition for the domestic players

Some of the major domestic players in the market are Company 3, Company 4, Company 5 and Company 6


•Introduction

•Market Overview

•Drivers & Challenges

•Government Initiatives

•Trends

•Competition

•Key Takeaways


Introduction

•Defining the product

Personal computers are used for various purposes and has become an integral part of present day life

•Usage 1

• Usage 2

• Usage 3

• Usage 4 Sub‐point 4

• Usage 5

• Usage 6

Usage

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Various kinds of personal computers are available, such as desktop PCs…

• aaa

• bbb

Notebooks • ccc

Laptop

Desktop

Sub‐Notebooks • ddd

Types of PCs (1/2)

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Global PC market is intensely competitive with marginal product differentiation and varied market environments

Rise in Global PC ShipmentsGlobal PC Market – Overview

Note: Excluding Tablet PC sales

• In Q2 20‐‐, worldwide PC shipments volume reached ~x

mn units, y % y‐o‐y growth

• In Q3 20‐‐, Notebooks grew p% and desktops increased

q%, but netbooks declined r% from the same period last

year

PC market expansion has been primarily driven by the rise in

popularity of pads with sales tripled in Q3 20‐‐ up from Q3 20‐

‐

0

20

40

60

80

100

mn units+w%

Q2 20‐‐

a2

Q2 20‐‐

a1

Market Size and GrowthDomestic PC Market – Overview

• China is expected to lead the global PC market by 20‐‐

• China is gradually emerging as a leader in PC market ,

which reflects the increasing affluence of emerging

markets, as well as the comparative stagnation of more

mature regions

Company 1, the Chinese PC market leader, has directly

benefited from the rapid growth in the PC market, accounting

for g% of global shipments and ranking hrd after Company 2

(i%) and Company 3 (j%) in Q3 20‐‐

0

50

100

150

200

mn units

+x%

2015e

b3

2010e

b2

2005

b1


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Drivers & Challenges – Summary

Growing Consumer Goods Retailing

Drivers

Increasing Internet Usage

Huge Consumer Base

Rising Income

Accelerating Urbanization and Changing Lifestyle

Untapped Market Potential

Reduction in Import Duties

Growing Online Retailing

Growing Computer Education

Challenges

Rise in Use of Smartphones

Rapid Technology Obsolescence

Rapid Price Drops and Low Profit Margins

Challenges in Overseas Expansion

Low IT Spending


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Internet popularity assumes massive popularity, providing huge impetus to the growth in PC market

•Finding 1 Sub‐finding 1

• Finding 2 Sub‐finding 2

Sub‐finding 2’

• Finding 3

Increasing Internet Usage Impact

Heading 1 Heading 3Heading 2

0

200

400

600

800

mn

+x%

20‐‐e

t5

510

b5

20‐‐ Jun

t4

300

b4

20‐‐

t3

277

b3

20‐‐

t2

213

b2

20‐‐

t1

157b1

Segment a

Segment b

0

20

40

60

80

100

120

%

+y%

20‐‐e

70

d5

20‐‐ Jun

48

d4

20‐‐

45

d3

20‐‐

35

d2

20‐‐

27d17

Segment a

Segment d

0

20

40

60

80

+y%

+z%

+x%

Product 3

e6e5

Product 2

e4e3

Product 1

e2e1

20‐‐ 20‐‐


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• Finding 1

• Finding 2

• Finding 3

High consumer base is propelling the growth of the PC market in China

Huge Consumer Base Impact

Heading 4

Total Population in 20‐‐: ~y mn

d%

b%

c%

a%

>4515‐29 30‐440‐14

Large target market‐above x% of the total

population


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Rising income and reduced prices to provide new growth opportunities for PC manufacturers

•Finding 1

•Finding 2

Sub‐finding 2

•Finding 3

•Finding 4

Rising Income Impact

Heading 5 Heading 6

0

500

1,000

1,500

2,000

USD

a1

+x%

Jan‐Jun 20‐‐

a2

Jan‐Jun 20‐‐0

10

20

30

40b1

‐y%

20‐‐e

b3

20‐‐

b2

20‐‐

no. of weeks


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Accelerating urbanization coupled with changing lifestyle boosts PC sales

Accelerating Urbanization and Changing Lifestyle Impact

Heading 7

• Finding 1

Sub‐finding 1

• Finding 2

Sub‐finding 2

0%

20%

40%

60%

80%

100%

mn

20‐‐e

t4

b4%

a4%

20‐‐e

t3

b3%

a3%

20‐‐

t2

b2%

a2%

20‐‐

t1

b1%

a1%

Segment a Segment bAnalysis 1


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Low PC penetration provides significant opportunity for further growth

Untapped Market Potential Impact

Heading 8

• Finding 1

Analysis 2

Reduction in Import Duties Impact• Finding 2

x% y%

Before 27th Jan 20‐‐ After 27th Jan 20‐‐

0

50

100

%

Country 6

a8

Country 5

a5

Country 4

a4

Country 3

a3

Country 2

a2

Country 1

a1

Import Duty


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Rapidly growing retail industry facilitates the growth of PC market

Growing Consumer Goods Retailing Impact

• Finding 1

Sub‐finding 1

• Finding 2

Growing Online Retailing Impact

Heading 9

Heading 10

Analysis 3

0

100

200

300

USD bn+x%

Oct 20‐‐

a2

Oct 20‐‐

a1

0

100

200

USD bn

+y%

20‐‐e

b4

20‐‐e

b3

20‐‐e

b2

20‐‐

b1


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Growing computer education pushes further PC usage in China

• Finding 1

• Finding 2

• Finding 3

• Finding 4

Growing Computer Education Impact

Heading 11 Heading 12

USD bn

+x%

20‐‐e

t2

g2%f2%

e2%

d2%

c2%b2% a2%

20‐‐

t1

g1%f1%e1%

d1%

c1%b1%

a1%h

g

e

d

c

b

ai1%

j1%

m1%

l1%

k1%

j

i k m

l


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Impact

Heading 13 Heading 14

Non PC‐devices becomes increasingly trendy, providing stiff competition to the PC market

Rise in Use of Smartphones


Sub‐finding 1’


• Finding 3

0

100

200

300

400

mn

20‐‐

+x%a2

20‐‐

a1

0

20

40

60

80

100

mn units

b1

+y%

20‐‐e

b3

20‐‐

b2

20‐‐


SAMPLE

Lack of established Chinese brands restricts global expansion

Challenges in Overseas Expansion Impact

• Finding 1

• To achieve global recognition, domestic companies must focus on following categories:

Heading 15

Category 1

Category 4

Category 3

Category 2

Analysis 4

0

20

40

60

80

%

Country 3

a3

Country 2

a2

Country 1

a1


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Summary – Trends

PC Vendors Move towards Smartphones Miniaturization

Emerging Netbooks Rising Popularity of Tablet PCs

Trends


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Tablet PC market in China will become more mature in the coming years

Rising Popularity of Tablet PCs

Analysis 5

Heading 16• Finding 1• Sub‐finding 1


0.0

0.5

1.0

1.5

2.0

2.5a2

20‐‐

a1

mn units

20‐‐e

+x%

Date Description

Jan 20‐‐ • Event 1

Mar 20‐‐ • Event 2

Mar 20‐‐ • Event 3

Jul 20‐‐ • Event 4


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PC vendors need to adopt strategies to face the growing competition in the Chinese PC market

•Finding 1

Sub‐finding 1

• Finding 2

Sub‐finding 2

Competitive Landscape – Market ShareCompetition – Overview

Pre‐requisite to become a successful PC vendor

• Point 1

• Point 2

• Point 3

• Point 4

• Point 5

n%

m%l%k% j%i% h%g%f%

e%d% c%

b%

a%

Others

Company 13

Company 12

Company 11

Company 10

Company 9

Company 8

Company 7

Company 6

Company 5

Company 4

Company 3

Company 2

Company 1


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Domestic Competition – Summary (1/2)

1,238.8

2,769.1

9,189.4

16,604.8

36.5

72.7

308.6

129.4

0 5,000 10,000 15,000 20,000

Company 2

Company 1

Company 3

USD mn

Company 4

Net Profit

Revenue

Revenue and Profit for Major Domestic Companies of 20‐‐


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0

50

100

150

200

250

300

350

400

450

13,00012,00011,00010,0009,0008,0007,0006,0005,0004,0003,0002,0001,0000

c

b

a

d

17,00016,00015,00014,000Revenue

18,000

Net Income

Domestic Competition – Summary (2/2)

Size of the Bubble represents Market Capitalization in USD mn

Company 4Company 3Company 2Company 1


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Major Domestic Players in the Market (1/5)

Headquarters Province 1

Founded 20‐‐

ProductsProduct 1, product 2, product 3, product 4, product 5, product 6, product 7, product 8

Key People Person 1– President

Company Snapshot: Company A

Business Highlights

Corporate Information Financial Performance

Profit/Loss

Revenue

0

500

1,000

1,500

0

10

20

30

40

RevenueUSD mn

Profit/LossUSD mn

20‐‐

a4

20‐‐

a3

20‐‐

a2

20‐‐

a1

• Company engages in the manufacture and sale of computer and other electronic products in country 1and internationally

• In Oct 20‐‐, Company A. entered into an agreement on equity transfer to acquire x % stake in company b from company c for ~ USD y mn

• In Apr 20‐‐, company announced that the company's wholly owned subsidiary, a city 1‐based manufacturing company, will transfer a z % stake in a city 1‐based technology development company to an information industry holdings company, at USD p mn

• In Dec 20‐‐, company announced that it divested a x % stake in a city 2‐based computers company to a city 3‐based digital company, at USD q mn


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PC market has experienced rapid growth and China is expected to be the world’s largest PC market by 20‐‐PC industry has become a leading industry in China's national economy and is playing a guiding and supporting role in

the overall national economic situation

Increasing internet use and rising prosperity which has resulted from accelerating urbanization, acts as a major driver for the growing demand of personal computers in the country

Opportunities in the Market

Market SizeInitiatives Taken by

Players

ChallengesLow market penetration and reduction in import provides scope for the PC vendors

Growing retail industry coupled with increased computer educationsupports the future prospects of the PC industry

• Rise in use of smartphones

• Rapid technology obsolescence

• Rapid price drops and low profit margins

• Challenges in overseas expansion

• Low IT spending

Players are taking steps to upgrade the quality of their services

Mini PCs, Tablet PCs, netbooks are being added to the product portfolio to sustain competitiveness

0

50

100

150

200

mn units

a2

a1

20‐‐

+y%

20‐‐e

a3

20‐‐e

Players need to focus on global expansion by strengthening their consumer brand and products


Thank you for the attention

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