New Delhi, Dec 10 (SocialNews.XYZ) The Indian electronics system design and manufacturing (ESDM) industry, valued at about Rs 2.09 lakh crore in FY23, is estimated to reach Rs 9.09 lakh crore by FY28E, at a compound annual growth rate (CAGR) of 34 per cent, a report said on Tuesday.
The key growth drivers include rising outsourcing of manufacturing by original equipment manufacturers (OEMs) to specialised ESDM providers, growing demand for electronics, a large and expanding domestic market, the 'China +1' strategy, and various government initiatives such as the production-linked incentive (PLI) scheme and investments in semiconductor development, according to the report by PL Capital Group - Prabhudas Lilladher.
“ESDM sector's addressable market was valued at Rs 4.39 lakh crore in FY23, with OEMs gradually increasing reliance on ESDM partners,” said Praveen Sahay, research analyst.
Additionally, the domestic printed circuit board assembly (PCBA) market is expected to clock a CAGR of 41.6 per cent and reach Rs 6.55 lakh crore by FY26E, up from Rs 2.31 lakh crore in FY23.
“Growth will be driven by factors such as increasing value addition, rising global demand for electronics, and the need for high-speed assembly and miniaturisation,” said Sahay.
To capitalise on this opportunity, India is incentivising contract manufacturers and expanding its manufacturing capabilities, which will boost PCBA exports, enhance India's role in the global supply chain, and strengthen its position as a electronics manufacturing.
The brokerage has initiated coverage on four domestic ESDM companies - Avalon Technologies, Cyient, Kaynes Technology and Syrma SGS Technology with a positive outlook.
All four companies are well-positioned for growth, supported by diverse sector penetration, strong order books, and strategic expansion plans.
“As OEMs delegate manufacturing to ESDM partners, they can concentrate on marketing and post-sales services and growth initiatives, while ESDM firms leverage economies of scale to adapt to technological changes and negotiate better with suppliers,” it added.
—IANS
na/
Source: IANS
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