The Hindu Business Line : Rising laptops sale drags UPS market down

Adverse impact
The entire UPS market witnessed a decline of 5% in sales for the half year ended September 2007
UPS growth in the four metros fell by 17 per cent

K. Bharat Kumar
Moumita Bakshi Chatterjee

Chennai/New Delhi, March 25 A rise in the sale of laptops and, ironically, a deteriorating power situation across the country, has augured ill for the low-end Uninterruptible Power Supplies (UPS) market.

The entire UPS market witnessed a decline of 5 per cent to 8.4 lakh units in sales for the half year ended September 2007 over the same period in the previous year, according to MAIT, the apex body for the IT hardware and peripherals industry in India. Households accounted for 69 per cent of the market, registering a growth of 35 per cent, while businesses accounted for the remaining 31 per cent showing a decline of 42 per cent over the same period last fiscal.

A low-end UPS services a single PC, especially at homes and small offices to allow a user to save his data should a sudden power-cut occur.

Responding to queries, Mr Ankesh Kumar, Head, Marketing, Emerson Network Power, said, “The data is for products sold through resellers and includes low kVa UPS, which largely caters to home users.”

He said this contributed to only 40 per cent of the total UPS market and depended highly on sales of desktops.

By inference, since desktop PCs themselves have grown only 3 per cent in the same period, it is evident that related sales of low-end UPS could not have seen record sales.

Shifting to laptops

Mr Kumar said, “Users are shifting to laptops.” According to MAIT, for the same time period, laptops have grown to make up about 21 per cent of the total PC market from a lowly 3 per cent four years ago. A laptop does not need an additional power supply system since it comes with a rechargeable battery.

He added, “Large enterprises are still particular about power backup and data protection. We have witnessed huge growth in the enterprise segments that require UPS supplies of 20 kVA and above.”

“In the large UPS segment, the market is still growing at more than 30 per cent.” He did not elaborate on absolute numbers.

Mr Subodh Tagare, Marketing Director, APC-MGE, a major player in the UPS arena, agrees. According to him, “Today, if there is a power cut for 30 minutes, it has a major impact on the productivity of any industry which leads to losses. To overcome this, most companies have installed a power backup. A high end UPS, and not a low end one, would meet the needs of a medium-sized (and above) company.”

But aren’t generators are an alternative? No, he feels. “They may be an economic option but the turnover time is too high. Besides, they cause a lot of air- and noise-pollution.”

He adds, “The UPS market may be a little slow, but the situation is not alarming.”

Class B cities

Interestingly, UPS growth in the four metros fell by 17 per cent while growing 187 per cent in Class B cities, including Bangalore, Pune, Ahmedabad and Hyderabad.

According to Mr Tagare, “Sales in these cities are rising as the standard of living is increasing. With the economic conditions of tier II cities improving, people now can easily afford a UPS.”

Microtek, another UPS supplier, thinks likewise. Mr Manoj Jain, Area Manager, Marketing, Microtek International said, “Laptop sales in the metros have risen and demand for PCs has increased heavily in B-class cities simultaneously,” indicating that related sales of UPS, supporting single PCs, would obviously grow.

Peeping into the future, Mr Kumar of Emerson said, “Companies are moving towards virtualisation and consolidation. So, the lower range of UPS or offline UPS would decline in the coming years. Medium-sized and large UPS systems, which make up 60 per cent of the total market, may grow two-fold.”

He says his optimism stems from the emergence of infrastructure projects, SEZs, the retail boom, banking sector growth and the advent of eGovernance projects.

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