UPDATE 1-Dell sees softness in demand, bullish on India

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By Sumeet Chatterjee

BANGALORE Oct 23 (Reuters) - Dell (DELL.O), the world's second-biggest computer maker, is seeing softness in demand for personal computers due to the global economic downturn, but hopes to increase market share in emerging markets such as India, a senior official said on Thursday.

"We already talked about seeing a little bit of softness in demand. We were pretty clear about that number of weeks ago," Chief Marketing Officer Mark Jarvis told reporters.

Dell, which trails Hewlett-Packard (HPQ.N) in the computer sector, in August posted a steep drop in second-quarter profit, as slow demand for PCs spread from the U.S. corporate sector to the public sector and small businesses, and to Europe and Asia.

But Jarvis, who reports to CEO Michael Dell, said Dell would outpace the industry in unit shipments in the second half of the year, as it sharpens its focus on markets such as India, where the companies are stepping up investments on technology.

"We believe that an economic slowdown will eliminate some of our marginal competitors and will give us the ability to gain share and we are strategically focused on gaining that share in a number of markets," Jarvis said.

"We are extremely bullish on India," he said.

Chief Executive Dell told reporters in Shanghai on Wednesday the company was performing well in unit shipments compared with the overall industry, and expected to grow faster than the industry this year. [ID:nSHA201089]

The company said in August it had slashed 8,500 jobs out of a planned 8,900 headcount reduction, as it realigns its business to confront slowing demand.

Dell, which has a computer-making facility in southern India, sees huge opportunity in India where only 12 percent to 13 percent of small and medium-sized businesses use information technology, Jarvis said.

"I should stress that when we look at our share in countries around the world, we see enormous opportunity in India to grow that share," he said, after launching a new marketing campaign for India.

Personal computer shipments in Asia excluding Japan grew 12 percent to 20.2 million units in the third quarter, researcher IDC said in preliminary data released on Monday. The growth figure was 2 percent short of its forecast for the region. (Editing by Ranjit Gangadharan)