According to the reports released on Monday, Lenovo Group Ltd is right on way to cross past Hewlett-Packard Co as the biggest maker of PC in the whole world on the basis of the sales this year. It is the first company of China to have notched the top position in the technology sector globally.
The market of Lenovo:
The rise in the market of Lenovo, the maker of ThinkPad, reflects the advancement of the technological firms in China globally in the recent years. This is mainly due the combination of overseas acquisitions, aggressive pricing and their ways of taking advantage of the ever growing domestic market. Some analysts have however warned of the fact that the rapid gain in the market shares of Lenovo have come at the cost of its profit margins. The company however faces a slowing rate of growth in the market for the PCs and the tough rivals in the space of the tablet PC.
An analysis of the market by Frederick Wong, states that it will only be a very short length of time before Lenovo would be at the top of the technological market worldwide at the most by the end of this year. Mr. Frederick Wong is the executive director of Avant Capital Management Ltd. based in Hong Kong and a share holder of Lenovo as well. He also added that pressure could well be created on Lenovo because of a weak outlook on the PC market and tough competition in the tablet sectors. Lenovo had reached the second spot as a vendor for PCs in the penultimate quarter of the year 2011. The shares of the company were at 14.9% in the global market this year in the quarter that lasted from April to June. This was only 0.6% points away from the first ranked HP whose shares stand at 15.5% as per the reports released based on the latest data of the research firm named IDC. According to the figures provided by the industry tracker named Gartner the gap between Lenovo and HP is even narrower by merely 0.2% points.
Lenovo and its endeavors:
The rise of Chinese company Lenovo is aided by its purchase of Medion a German company, apart from a joint venture with NEC Corp. of Japan the previous year. The acquisition of Lenovo with the PCV business of IBM is also a major factor that has led to its rise in the global PC market. Investors of the market have rewarded Lenovo for the gain in its market shares and have sent its stocks upwards by nearly 16% during this year thereby out spacing its rivals like HP, Dell and Acer. The stocks of the companies have dropped considerably over the period in which the stocks of Lenovo have risen. The current trades of Lenovo have forwarded its earnings by about 12.5 times that are calculated as the second among the top five makers of PC in the world. According to the data, this is quite well above the earnings of Thomson Reuters Starmine and HP.