Find out what is driving Motilal Oswal Wealth’s bullish stance on the five EMS(Electronics Manufacturing) companies, where it sees a potential upside of up to 25% each over the next 12 months.
These five stocks benefit from Electronics manufacturing becoming a ₹6 lakh crore industry by FY27
Motilal Oswal Wealth Management, in a report published on Monday, December 2, anticipates that the electronics manufacturing sector in India is on the verge of a significant transformation. They predict a Compounded Annual Growth Rate (CAGR of 26% from 2023 to 2030, with the sector poised to reach $500 billion or approximately ₹6 lakh crore.
“India is becoming a favored global hub for electronics manufacturing, driven by increased assembly activities and unprecedented demand in the EMS sector, especially in mobile phones, automotive, and industrial areas.
Favorable governmental initiatives like the PLI schemes and the Semicon India program, combined with a surge in domestic demand and a strong emphasis on self-sufficiency, are further enhancing these opportunities,” stated Motilal Oswal Wealth in their report.
Consequently, they have created a portfolio of five stocks expected to benefit from the growth within the EMS sector, with potential gains of 20% to 25% over the next year. Below are the five stocks in the EMS portfolio, each weighted equally at 20%:
Dixon Technologies | Dixon is experiencing strong sales with current mobile clients. Motilal Oswal Wealth anticipates Dixon will continue thriving due to its leading market positions, the addition of new sectors, backward integration, and an improved product mix.
CG Power | This company specializes in the design, production, and marketing of power generation, transmission, and distribution products. It produces voltage motors, circuit breakers, switchgears, and power monitoring devices.
Kaynes Tech | An integrated electronics manufacturer focused on IoT, Kaynes is on a promising growth path with a strong order book and improved profit margins. The company aims to achieve $1 billion in revenue by the fiscal year 2028 and triple its top line by fiscal year 2029.
Amber Enterprises | Following success in the air conditioning sector, where they’ve gained new clients, Amber is now expanding into automotive, defense, medical, and telecom sectors, with the goal of rapidly growing its electronics division.
Syrma SGS | Engaged in EMS, this company serves a wide range of industries including automotive, healthcare, consumer goods, industrial, IT, and railroads. With an order book of ₹4,800 crore, Syrma ensures a clear growth trajectory. Strategic investments in facilities in Pune and Hosur, along with untapped IPO funds, align with the company’s revenue target of ₹4,500 crore for financial year 2025, as indicated by Motilal Oswal Wealth.
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