All sectors
Capital Goods
Electronics Manufacturing (EMS/OSAT)
EMS compounding at 30%+ with an OSAT lottery ticket attached
Medium capitalFragmented2 listed names covered
Kaynes and Syrma ride India's electronics-manufacturing wave (auto, industrial, aerospace boards) with 25-35% revenue CAGRs. Kaynes layered a semiconductor OSAT bet on top — ₹600 Cr FY26 cash burn against a potential first-mover packaging position. High multiple, high WC, high optionality.
TAM: India EMS $20B→$80B by 2030 (26% CAGR); OSAT/ATMP incentives (ISM 2.0) fund 50% capex; defence EMS (Centum) a specialised niche.
Demand drivers
- ▸Electronics import substitution + PLI
- ▸Auto electronics content per vehicle tripling
- ▸Defence/aero board-level outsourcing from primes
- ▸ISM 2.0 semiconductor packaging incentives
Competitive dynamics
- ▸Fragmented vs Dixon/Amber at scale ends; Kaynes/Syrma differentiate via industrial mix
- ▸OSAT race: Kaynes Sanand vs CG-Renesas vs Micron ATMP — first qualified line wins marquee customers
- ▸Centum's niche: space-grade + missile electronics at build-to-spec margins, dragged by French subsidiary losses
Unit economics
- ▸EMS OPM 9-16% by mix; ROCE mid-teens with WC drag
- ▸OSAT target economics: 25-30% EBITDA at scale, but 3-4 year J-curve
- ▸Kaynes FY26: 16% OPM but CFO -₹600 Cr — growth is being bought with cash
Key programs
- ▸Kaynes OSAT Sanand ramp (FY27 qualification)
- ▸Syrma margin-repair plan (6%→11% done, 13% target)
- ▸Centum Adetel (France) turnaround/exit decision
What an expert watches
- ▸Kaynes cash conversion inflection
- ▸OSAT customer qualification announcements
- ▸Defence EMS order wins at Centum post-restructuring
Sector scoreboard — real data
| Company | Mkt cap | P/E | OPM | ROCE | Sales 3Y | Fundamental | Tech score | Decision |
|---|---|---|---|---|---|---|---|---|
| Syrma SGS Technology | ₹25.8K Cr | 80.5x | 11% | 16.7% | 33.0% | 72 | 84 | Hold / Watchlist |
| Kaynes Technology | ₹22.3K Cr | 61.0x | 16% | 13.2% | 47.7% | 60 | 42 | Hold |