India's Redington sees AI-enabled PCs powering tech upgrades

Redington

15/02/2024 03:49

By Praveen Paramasivam
       CHENNAI, Feb 15 (Reuters) - India's Redington  REDI.NS 
expects demand for personal computers to bounce back next
financial year as customers are likely to warm up to new devices
with artificial intelligence features, a top executive at the
tech goods distributor said.
    Global PC sales are showing signs of recovery after
inflation-hit customers delayed system upgrades for several
quarters, results of chipmakers including Samsung Electronics
 005930.KS  and Intel  INTC.O  showed.
    "The advent of AI, PCs will also drive tech refresh,"
Redington's Singapore, India and South Asia (SISA) CEO Ramesh
Natarajan told Reuters, adding that he sees its PC business
posting a single-digit percentage growth in fiscal 2025 in the
region after reporting declines in the last six quarters.
    AI-enabled PCs refer to machines that come with chips
capable of running large-language models and apps powered by the
technology directly on the device, instead of the cloud.
    "Considering the replacement cycles for PCs have averaged
around three to four years, we believe 2024 will be the year
that will see some rebound," said Neil Shah, vice president of
research at Counterpoint Research.
    SISA revenue from Redington's end-point solutions unit,
which distributes PCs and printers, fell 7% to 100.72 billion
rupees ($1.21 billion) in the nine months ended Dec. 31.
    The segment, which accounts for about 15% of the group's
total revenue, had gained during the pandemic when businesses
and individuals spent heavily to set up home offices. But many
are yet to upgrade.
    Natarajan also expects more growth in Redington's mobile
phone business, which distributes smartphones from Apple, Google
and others, as affluent Indians splurge on phones that cost more
than 30,000 rupees ($361.30). The segment had seen a 61% revenue
jump in the first nine months of fiscal 2024 in the SISA region.
    Redington has been sharpening its focus on its cloud
services business to expand beyond gadget distribution, which
brings in a bulk of its revenue. 

 (Reporting by Praveen Paramasivam in Chennai; Editing by Dhanya
Skariachan and Janane Venkatraman)
 ((Praveen.Paramasivam@thomsonreuters.com; +91 867-525-3569;))