Pakistan Consumer Electronics Report Q2 2016
BMI View: Pakistan's consumer electronics market presents many operating challenges to vendors and is aregional laggard in terms of device spending per capita and penetration rates - but we believe it is movingto a stronger growth trajectory as several positive trends converge. The rollout of 3G services and supply ofcheap smartphones saw a handset spending boom take-off in 2014-2015, while rising incomes andincreased local production are positive for the PC market. At the same time investments in retail anddistribution are formalising operations and all these factors underpin our view that vendors grow revenuesby driving up penetration rates over 2016-2020, a period during which we forecast total device spendingwill grow at a CAGR of 9.1%. This will make Pakistan a regional outperformer in device spending growthas markets in East Asia decelerate due to increasing saturation.
Latest Updates & Industry Developments
Computer Sales: from USD1.1bn in 2016 to USD1.5bn in 2020, a CAGR of 6.8%. As incomes rise theaddressable market will expand rapidly, and we expect low-end tablet and notebooks will register thestrongest volume growth.
AV Sales: USD1.2bn in 2016 to USD1.4bn in 2020, a CAGR of 4.4%. Flat-panel TV set upgradepotential still exists in Pakistan, but price erosion and digital camera volume cannibalisation will makeAV segment the underperformer over the medium term.
Handset Sales: USD2.9bn in 2016 to USD4.5bn in 2020, a CAGR of 11.8%. The smartphone boomkicked off in 2014, but with penetration only reaching 15% of adults at YE15 we believe upgrademomentum will be sustained over the medium term and drive robust overall handset spending growth.
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