Indian semiconductor driven market to grow by 13.4% by 2010

Bengaluru: The India Semiconductor Association (ISA) and Frost and Sullivan (F&S) released the ISA-Frost & Sullivan report update 2008-10 in Bengaluru. ISA is the trade body representing the Indian semiconductor driven industry. This is the third report on the subject and the second update.

The report was released by Jaswinder Ahuja, Chairman, ISA and Corporate VP and MD, Cadence Design Systems India along with Poornima Shenoy, President, ISA and Anand Rangachary, MD-South Asia and Middle East, Frost & Sullivan.

According to the report, the total revenues of the Indian semiconductor market (Total Market - TM) are poised to grow from $5.9 billion in 2008 to $7.59 billion in 2010 at a CAGR of 13.4 percent. 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 percent.

The decline in CAGR, from 26.7 percent, in the earlier report of 2007, to 13.4 percent, 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 three to 10 percent depending on the final product and the semiconductor content. The overall global slowdown had also not been anticipated during the previous report of 2007.

Speaking at the launch, Shenoy 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.”

Rangachary said, “Information technology and 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.”