homemarket Newsstocks NewsEditors’ Roundtable | Spotlight on India’s electronics manufacturing services sector
Editors’ Roundtable | Spotlight on India’s electronics manufacturing services sector
The electronic manufacturing services (EMS) sector has been buzzing since the last couple of months. In fact, last week, we saw debut of a new company called IKIO Lightings, and that listed at a 45 percent premium to the issue price. Globally, EMS market is expected to be at $3.1 trillion by CY25, and is growing at a CAGR of 4.9 percent. India currently has just 2.2 percent market share in the global pie and that is expected to go up by four folds to 7 percent by CY26. However on a valuation basis most of the companies are trading at expensive levels.
The electronic manufacturing services (EMS) sector has been buzzing since the last couple of months.
In fact, last week, we saw debut of a new company called IKIO Lightings, and that listed at a 45 percent premium to the issue price. Next week, we are going to see Cyient DLM, a company from the EMS space opening its public issue. So there is a lot of buzz going around in this particular space.
How big is the opportunity?
Globally, EMS market is expected to be at $3.1 trillion by 2025, and is growing at a CAGR of 4.9 percent. Out of the $3 trillion, the EMI pie is going to be fastest moving pie, it is expected to reach nearly $1.1 trillion by 2025 and it's going to grow at nearly 5.5 percent.
India currently has just 2.2 percent market share in the global pie and that is expected to go up by four folds to seven percent by 2026. So the opportunity is quite big when you look at the global picture.
Traditional businesses like mobile phones, consumer electronics and industrials contribute the most to the EMS sector. However, going forward components like medical devices, aerospace and defense, clean energy are expected to be the big drivers for the sector.
Stockwise, Kaynes Technology has nearly doubled in the last six months, Syrma SGS Technologies is up 57.8 percent, while Avalon Technologies is up 36.8 percent. However on a valuation basis most of the companies are trading at expensive levels.
Also Read: Time has come for India to leap ahead in finished electronic product segment, says expert
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