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Component is an java instance managed by Nucleus. Nucleus is like ATG Container.
ATG follows the IOC design pattern thru components.
Another advantage of components is you can layer the components if you have to override any of the previous layer properties.
OOTB module components properties can be over-ridden in our module by creating same components and overriding the properties which helps in easy customization.
Being component centric and with Nucleus managing entire Life cycle of components and dependency injection, it relieves the programmer from the burden of instantiating the components and managing its dependent components.
Thank you shaik and Karthik. It's pretty clear to me.
Can you mark the answer as correct?