Rs.25,000 Crore PLI Scheme Expected to Supercharge India's Electronics Sector in Budget 2025!

There were reports in Moneycontrol.com that Indian government is poised to announce a Rs.25,000 crore Production-Linked Incentive (PLI) scheme aimed at bolstering the manufacturing of electronic components. Photo: Just Dial.

Following the Finance Ministry's approval, the Ministry of Electronics and Information Technology (MeitY) is expected to seek Cabinet approval, with the scheme likely to be unveiled in the upcoming Union Budget 2025. 

This initiative is part of India's broader strategy to enhance domestic electronics manufacturing, reduce dependence on imports, particularly from China, and strengthen the local supply chain. The scheme is anticipated to attract both domestic and international investments, fostering job creation and technological advancement in the sector. 

Investors looking to capitalize on this development may consider shares of companies operating within the electronic components sector. Here are some notable firms in this space:

SYRMA SGS Technology (Rs.598.15; Face Value: Rs.10):

A leading provider of turnkey electronic manufacturing services, including product design, PCB assembly, and box building. The company has a strong presence in the electronics sector and stands to benefit from the PLI scheme. 

Inauguration of New Manufacturing Facility:

On October 23, 2024, Syrma SGS inaugurated an integrated electronics manufacturing facility in Ranjangaon, Pune, Maharashtra. This state-of-the-art facility is expected to enhance the company's production capabilities and support its growth trajectory. 

Financial Performance:

For the quarter ending September 30, 2024, Syrma SGS reported a total revenue of ₹842.78 crore and a profit of ₹36.24 crore. The company's earnings per share (EPS) stood at ₹1.81, reflecting a robust financial performance. 

Dividend Declaration:

On May 10, 2024, Syrma SGS declared a final equity dividend of ₹1.50 per share, representing a 15% dividend on the face value of ₹10 per share. The ex-dividend date was September 10, 2024. 

Stock Performance:

Over the past three months, Syrma SGS's stock price has appreciated by approximately 47.93%, indicating strong investor confidence. 

Industry Recognition:

In September 2022, Syrma SGS received the ELCINA Special Jury Award for "Electronics Company of the Year" for 2021-22, underscoring its commitment to excellence in electronics manufacturing. 

These developments highlight Syrma SGS Technology's strategic initiatives to expand its manufacturing capabilities, deliver strong financial results, and maintain a positive trajectory in the electronics industry.

Dixon Technologies (Rs.18,260.75; Face Value: Rs.2):

A prominent electronics manufacturing services (EMS) company in India, engaged in the production of consumer electronics, home appliances, and lighting products. Dixon has been expanding its capabilities and could leverage the incentives provided by the PLI scheme

Bharat Electronics Limited (Rs 285.65; Face Value: Re.1):

A state-owned enterprise specializing in the manufacturing of advanced electronic products for the defense sector. BEL's diversified portfolio and government backing make it a key player in the electronic components industry.

Astra Microwave Products (Rs.765.60; Face Value: Rs.2):

Engaged in the design and manufacture of high-quality radio frequency and microwave super components and sub-systems. The company's focus on indigenous production aligns with the objectives of the PLI scheme.

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From among the above, my favourite is SYRMA SGS Technology Ltd which is indeed a significant player in the electronic components sector. The company offers a wide range of services, including product design, prototyping, PCB assembly, and box building, catering to various industries such as automotive, telecom, industrial, healthcare, and IT. 

Investing in companies like SYRMA SGS Technology and others in the electronic components sector could be advantageous, given the government's focus on promoting domestic manufacturing through initiatives like the PLI scheme.