BMI View: We have made a downward revision to our historical data and forecast for the handset market, which has put a drag on our overall Consumer Electronics market forecast for South Africa. Based on new trade data for the country s consumer electronics market, and benchmarked against household income data and industry trends, we believe total spending on smartphones is lower than previously estimated. Despite these changes, we retain our view that the handset market has outperformed the PC and AV segments, as greater affordability and functionality make them a more essential purchase for many South African consumers. The PC and AV markets have underlying growth potential due to low device penetration rates, although we do not expect it to fulfil this potential, at least in the short- to medium term as currency weakness pushes up the cost of big ticket items. We forecast South African consumer electronics spending to grow at a -.- compound annual growth rate (CAGR) to reach USD-.-bn in ----. ...The PC and AV markets have underlying growth potential due to low device penetration rates, although we do not expect it to fulfil this potential, at least in the short- to medium term as currency weakness pushes up the cost of big ticket items. We forecast South African consumer electronics spending to grow at a -.- compound annual growth rate (CAGR) to reach USD-.-bn in ----.
...After the market contracted by -.- in ----, BMI expects little improvement in ----, with total spending forecast to contract by -.- to USD-.-bn. Our expectation for demand to remain depressed in ---- is in large part derived from our Country Risk team s view for the rand to remain weaker throughout ---- - despite gains since its lows in Q--- - than in ----. ...After the market contracted by -.- in ----, BMI expects little improvement in ----, with total spending forecast to contract by -.- to USD-.-bn. Our expectation for demand to remain depressed in ---- is in large part derived from our Country Risk team s view for the rand to remain weaker throughout ---- - despite gains since its lows in Q--- - than in ----. This has led to further decline in purchasing power, although less so than in the context of recent years. ...We expect the strongest segment performance will again be handset sales in ----. This is based on several factors, including consumer demand for smartphone upgrades, in part enabled by low-cost devices launched
...Computer Sales: USD-.--bn in ---- to USD-.--bn in ----, a compound annual growth rate (CAGR) of -.- . This is a slight upgrade due to the rand s recovery from multi-year lows in early ----, but a return to sharp currency depreciation poses downside risks. ...
