Nomura has expressed a positive view on India’s electronics manufacturing services (EMS) sector following the government’s approval of a ₹22,920 crore Production-Linked Incentive (PLI) scheme aimed at boosting electronics component manufacturing. The scheme, which spans six years (with a one-year gestation period), is designed to attract ₹59,300 crore in fresh investments and generate ₹4.57 trillion in incremental production, according to the brokerage.
Nomura believes the initial contours of this new PLI scheme will significantly enhance the domestic EMS landscape, particularly by increasing value addition in mobile manufacturing from the current 18–20% to 35–40% over the next five years. The policy shift is expected to foster deeper localisation and bolster India’s position in the global electronics supply chain.
Among the key beneficiaries, Dixon Technologies (Buy) is highlighted for its plans to invest ₹400 crore in display assembly, which management believes could yield ₹3,000 crore in revenue by FY27E. Similarly, Kaynes Technology (Buy) stands to gain from the scheme’s hybrid incentives for high-density printed circuit boards (PCB), as it ramps up a ₹1,400 crore investment in this domain.
With Dixon trading at ₹617.00, Nomura anticipates strong tailwinds from the scheme to support long-term growth for both companies.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Please consult a qualified financial advisor before making any investment decisions.
