top of page
  • Writer's pictureSkiddo

"Government's PLI Approval Sparks Stock Surge for Syrma SGS, Netweb, ITI, Dixon, and Kaynes Tech"

Updated: Dec 3, 2023

Stocks of Syrma SGS Technology Ltd, Netweb Technologies India, ITI Ltd, Dixon Technologies (India), and Kaynes Technologies showed positive movement on Monday morning (November 20). These companies saw their stock prices rise after the government approved 27 companies for a new incentive program called the production-linked incentive (PLI) scheme, specifically designed for IT hardware.

Government's PLI Approval Sparks Stock Surge for Syrma SGS, Netweb, ITI, Dixon, and Kaynes Tech

Presently, approximately 80% of printed circuit board assembly and box build products originate from China through imports. Nonetheless, a noticeable shift is occurring towards import substitution. Moreover, the implementation of the Production Linked Incentive (PLI) scheme has expedited local manufacturing, resulting in a rise in sourcing from domestic EMS (Electronics Manufacturing Services) players. Consequently, this has expanded the potential market for EMS players within the country.

Avendus Spark predicts that Syrma SGS Technology and Kaynes Technology India will experience rapid growth, with Syrma SGS expected to grow by 28% and Kaynes Technology by 25% annually from FY23 to FY27. This growth will be driven by their increased focus on the local market, expanding their services in popular areas like cars and household electronics. They're also benefiting from the PLI scheme, which is helping them grow successfully.

But first what is PLI scheme for Electronic Manufacturing ?

The electronics manufacturing industry in India faces challenges compared to other countries. These challenges include a lack of proper infrastructure, supply chain, and logistics, high finance costs, unreliable power supply, limited design capabilities, and insufficient focus on research and development. To address these issues and encourage more manufacturing within the country, a new incentive program has been introduced.

Under this program, companies involved in making mobile phones and specific electronic components in India will receive incentives. These incentives will range from 4% to 6% of their increased sales compared to a set base year. This incentive will be available for five years after the base year, aiming to significantly improve the electronics manufacturing sector in India and position the country as a major player in the global electronics market.

Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.

48 views0 comments


bottom of page