Top EMS Stocks of 2024: PG Electroplast and Dixon Tech Surge Up to 140% Amid India’s Growth Boom

Electronics Manufacturing Services (EMS) stocks have been performing exceptionally well this year, with some delivering returns of up to 140%, making them a top pick for investors on Dalal Street.

The Indian EMS sector is booming, thanks to supportive government policies like the Production-Linked Incentive (PLI) scheme and the Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS). India’s growing manufacturing capabilities are also being boosted by the “China+1” strategy, which is helping the country compete globally.

The global electronics industry is expected to grow to US$3.1 trillion by 2026, with the EMS sector projected to grow even faster at a 5.4% annual rate, reaching US$1.1 trillion. India’s share of this market is set to increase significantly, potentially hitting 7% and US$80.2 billion by 2026.

So far this year, PG Electroplast has seen its stock price surge by 140%, climbing from ₹237.36 to ₹567. Dixon Technologies has also performed strongly, with its stock rising by 96%. Kaynes Technologies’ shares have jumped from ₹2,600 to ₹5,019, marking a 92% gain. Elin Electronics and Amber Enterprises have also posted impressive increases of 49% and 35%, respectively.

According to a recent report by Systematix Institutional Equities, seven companies in the EMS sector reported a 77% increase in revenue, a 63% rise in EBITDA, and a 75% jump in profit after tax (PAT) compared to last year. These results exceeded expectations, thanks in large part to strong demand for cooling products.

Motilal Oswal has started covering Dixon Technologies and Amber Enterprises, giving them ‘buy’ ratings and setting high target prices for their stocks. Dixon is noted for its rapid growth and diversification in the EMS industry, while Amber is praised for its expansion into electronics and mobility sectors.

Overall, the EMS sector’s impressive performance reflects its growing importance and potential in the global market.