The electronic manufacturing services (EMS) sector is drawing strong investor attention as government incentives drive optimism on growth.
The application window for the Electronic Component Manufacturing Scheme (ECMS) closed on 30 September with commitments of over ₹1.1 trillion—nearly double its target of ₹59,000 crore, according to electronics & IT minister Ashwini Vaishnaw
The scheme, with an outlay of ₹23,000 crore, seeks to boost value addition in mobile phones by incentivizing production of camera and display modules, printed circuit boards (PCBs), and other components.
Tech titans
Among the listed entities, Dixon Technologies is investing in camera and display modules and will receive incentives of 1–5% of turnover. It is also betting on lithium-ion cells, batteries, and related modules. Amber Enterprises India Ltd and Syrma SGS Technology Ltd have applied for advanced PCB manufacturing, for which they would receive 4-10% of turnover based incentives, apart from 25% capital subsidy.
PCBs, with a market size of about $5 billion (~ ₹44,000 crore) as per a Jefferies India report, have received greater interest as about 90% of India’s current requirement is met through imports. The imposition of a 30% anti-dumping duty by the government on advanced PCBs in March 24, should also help build the ecosystem. Kaynes Technology India Ltd, which is setting up an outsourced semiconductor assembly and test (OSAT) facility with capital subsidy of up to 70% under India Semiconductor Mission, is also setting up a PCB unit with support from the state government.
The ECMS comes at an opportune time, with incentives under the mobile phone production-linked incentive (PLI) scheme set to end this fiscal. The PLI programme had earlier helped scale up manufacturing sharply—Dixon, for instance, expanded its mobile phone volumes from just 0.9 million units in FY21 to nearly 30 million units in FY25.
JVs and capital raise
Companies are partnering with global tech players to bolster expertise. Amber has tied up with Korea Circuit, Syrma with Shinhyup Electronics of Korea and Italy’s Elemaster SPA.
To fund capex, Amber raised ₹2,800 crore via qualified institutional placement (QIP) and private equity last month; Syrma secured ₹1,000 crore through QIP in August. Kaynes tapped ₹1,600 crore via QIP in June and followed it up with another round last month, through issue of compulsorily convertible preference shares.
Jefferies estimates the combined capex for these firms will hit ₹9,000 crore in FY26–28, up from ₹5,800 crore in FY23–25.
Tariff clouds
Despite a buzzing domestic market, tariff risks in the US—a key export destination—pose challenges.
While mobiles and related segments are exempt currently, there is a strong possibility of a levy going forward. Indian companies may face significant disadvantages if the tariff is applied at the same rate as country specific tariff.
India currently faces a 50% duty, including a 25% penal tariff tied to Russian oil imports.
