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Semiconductor Policy Watch
Chips Are Already Leaving India:
What Changed for Syrma SGS and Kaynes After Modi's Speech
What Changed for Syrma SGS and Kaynes After Modi's Speech
Three plants are producing and exporting. Five to eight more are coming. A ₹1.27 lakh crore programme now backs the whole push. We flagged Syrma SGS and Kaynes early — here's the full update.
Back then, the thesis was simple. India was building an electronics and semiconductor ecosystem. Both companies were positioned to ride that build-out — one through OSAT packaging, the other through the broader EMS supply chain.
PM Modi's 80th Independence Day address, delivered from the Red Fort on August 15, 2026, gave that thesis a concrete update. This report walks through the policy shift in full, then applies it to both stocks.
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What the PM Actually Said
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The Prime Minister confirmed that three semiconductor plants are now operational. Their output is already being exported.
Those three are Micron, Kaynes Semicon, and CG Semi, all in Sanand, Gujarat. Kaynes began commercial production on March 31, 2026. CG Semi followed on July 4.
Modi also said five to eight more plants are expected to come online over the next seven to eight years. One additional unit is expected to start production later in 2026.
"Chips are indispensable — whether electronic goods, medical equipment or transportation systems. Without them, the world would come to a standstill."
The tone of this speech was different from earlier ones. Past addresses spoke of intent and construction. This one pointed to visible execution — the shift from "India is building capacity" to "India is shipping chips."
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The Policy Backbone: Semicon 2.0
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Behind the speech sits real money. The Cabinet approved Semicon 2.0 on July 15, 2026. The outlay is roughly ₹1.27 lakh crore.
That's well above the ₹76,000 crore committed under the first phase, Semicon 1.0. And Semicon 1.0 wasn't small either — it already carries cumulative investment commitments north of ₹1.64 lakh crore across roughly a dozen approved projects.
Semicon 2.0 widens the net considerably. It now covers chip design and IP development, fabrication, advanced packaging (ATMP/OSAT), equipment and materials, and R&D and talent development — not just assembly and testing, which was the bulk of phase one.
Alongside it, the Cabinet also cleared a ₹62,500 crore Mobile Phone Manufacturing Scheme, succeeding the earlier PLI-LSEM programme. Combined, the two schemes total close to ₹1.9 lakh crore of fresh high-tech manufacturing support.
For companies already inside or entering the ecosystem, this is a materially longer runway than what existed even a year ago.
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Kaynes Technology — Named on the National Stage
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Of the two, Kaynes has the more direct connection to the speech. Its subsidiary, Kaynes Semicon, is one of the three plants the PM referred to.
The Sanand OSAT facility cost around ₹3,300 crore to build. It handles assembly, testing, marking and packaging — with an initial focus on intelligent power modules for automotive and industrial use. Modi himself inaugurated it in March, calling it a bridge between Sanand and Silicon Valley.
Production has already reached customers abroad. Kaynes has shipped multi-chip modules to Alpha & Omega Semiconductor in the US, and is in talks with Infineon on MEMS microphone packaging.
The company is now looking further up the value chain. It's exploring joint ventures in wafer fabrication, gallium nitride, and micro-LED technology, and is preparing applications for the new ISM 2.0 window once it opens.
Q1 FY27 numbers, released August 7-8, showed revenue up a strong 40% year-on-year to ₹946 crore. Profit dipped 24% on margin pressure from the new capacity coming online, which is a normal pattern for a business scaling a large new facility rather than a sign of a weakening core.
The order book stood at ₹8,904 crore. The stock traded around ₹3,660 on August 14, well below its 52-week high of ₹7,705 — leaving room to re-rate as the Sanand ramp-up shows up more fully in future earnings.
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Syrma SGS — Building the War Chest for What Comes Next
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Syrma isn't in a plant yet. It's positioning for one.
The board has approved a fundraise of up to ₹1,000 crore through a QIP. Management has been clear this is a war chest — capital ready to deploy once the right semiconductor project or technology partner shows up under Semicon 2.0.
Management has also said it will enter semiconductors only with credible technology partners, rather than rushing into low-end assembly work that others are already chasing. That's a deliberate, higher-value strategy — closer to design, testing and module manufacturing than standalone chip assembly.
The core EMS business, meanwhile, keeps delivering. FY26 revenue came in at ₹4,819 crore, up 27%, with full-year profit of ₹317.78 crore. Q1 FY27 profit more than doubled to ₹100 crore, against ₹49.7 crore a year earlier.
The company is also investing in multilayer PCB and CCL capacity through a partnership with a Korean firm, has signed a new joint venture with a Japanese partner for EMS work, and recently appointed Jaidit Singh Brar as CEO to lead its move into more complex product lines.
The stock traded around ₹1,465 on August 14, near its recent highs — a sign the market already likes the direction of travel, even ahead of any confirmed semiconductor deal.
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Side by Side
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| Parameter | Kaynes Technology | Syrma SGS Technology |
| Semiconductor stage. | Already in commercial production and exporting. | Evaluating partnerships, capital ready via ₹1,000cr QIP. |
| Named in PM's speech. | Yes — one of three operational plants. | No — indirect ecosystem beneficiary. |
| Q1 FY27 revenue growth. | +40% YoY to ₹946cr. | FY26 revenue +27% to ₹4,819cr. |
| Q1 FY27 profit trend. | -24% YoY on ramp-up costs. | +101% YoY to ₹100cr. |
| Order book. | ₹8,904cr. | Strong order visibility, EBITDA margin guidance 10.5-11%. |
| Price (Aug 14, 2026). | ~₹3,660 (52wk high ₹7,705). | ~₹1,465, near recent highs. |
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What to Track Next
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A speech changes the policy narrative immediately. It does not change financial statements overnight. The next set of catalysts will come from concrete, company-level developments rather than further policy headlines.
For Kaynes, that means production volumes and customer additions at Sanand, progress on the wafer fab and GaN JV talks, and how quickly margins recover as the new facility's fixed costs get absorbed by higher volumes.
For Syrma, the key markers are the QIP outcome and how the proceeds get deployed, any confirmed technology partnership under Semicon 2.0, and progress on the multilayer PCB and CCL capacity build.
Across both, watch the ISM 2.0 application window and Semicon 2.0 approval timelines — the scale of the opportunity is now well defined, but individual project approvals will decide how quickly it converts into earnings.
The SumanSpeaks Verdict
The speech didn't create this story. It confirmed it.
Kaynes has moved from promise to production. Its plant is named, its chips are shipping, and its next leg of growth — wafer fab and materials JVs — is already in discussion.
Syrma is a step behind on semiconductors specifically, but its core business is compounding fast, and its ₹1,000 crore war chest means it can move the moment the right opportunity appears.
Finally, both stocks had a thesis before August 15. The speech simply told the rest of the market where SumanSpeaks was already looking.
This article is published by SumanSpeaks for general informational and educational purposes only. The author has over 25 years of capital markets experience. This is not a recommendation to buy, sell, or hold any security. All data is sourced from public exchange filings, regulatory orders, and credible financial media. Readers must conduct independent due diligence before making any investment decision.
| For personalized stock market insights and guidance, feel free to reach out at: sumanm2007s@gmail.com | suman2005s@rediffmail.com |
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