Best Semiconductor Stocks in India 2024

12 June 2024
8 min read
Best Semiconductor Stocks in India 2024
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(The stocks mentioned in the blog are as per Analyst Ratings and Market Capitalization)

With technological advancements like the EV revolution and the rollout of 5G, the semiconductor industry is experiencing significant growth and changes. These developments have led to an increased demand for semiconductors, as they are integral components in electric vehicles, telecommunications infrastructure and many electronic gadgets that you may use every day.

As a result, investing in top semiconductor stocks in India could offer promising opportunities to explore.

Semiconductor Industry in India - A Quick Overview

The semiconductor industry in India is crucial for the economy as it drives the technology sector's growth. Currently, India relies entirely on imports for semiconductors, mainly from Taiwan, China, Korea and Vietnam. However, with the increasing demand for electronic devices, there is an urgent need to reduce this dependence.

In 2023, the Indian semiconductor industry was valued at USD 34.3 billion and is expected to reach USD 100.2 billion by 2032, driven by an increasing demand for smartphones, wearables, automotive parts and computers. 

To reduce this dependence on imports of semiconductors, the Ministry of Electronics and Information Technology (MeitY) has launched the India Semiconductor Mission (ISM) with a USD 10 billion commitment. This includes incentives for manufacturing and the Design Linked Incentive (DLI) scheme to support semiconductor startups. Additionally, the government's 'Make in India' initiative and the Production Linked Incentive (PLI) scheme offer incentives to establish semiconductor manufacturing facilities in India.

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Best Semiconductor Stocks in India 2024 as per Analyst Ratings

Here is a list of the top semiconductor stocks in India to buy as per analyst ratings. We have taken analyst ratings as a criterion because these stock analysts run a comprehensive study before rating a stock-

S.No.

Best Semiconductor Stocks in India (as per analyst ratings)

BUY Analyst Rating (in %)

1.

Bharat Electronics Limited 

86

2.

CG Power and Industrial Solutions Limited 

67

3.

Hitachi Energy India Limited 

60

4.

V Guard Industries Limited 

62

5.

Havells India Limited

55

*Our stock selection criteria for top stocks based on analyst ratings are mentioned at the bottom of this blog.

Top Semiconductor Stocks in India in 2024 as per Market Capitalisation

The table below highlights the best semiconductor stocks in India for 2024, ranked by market capitalisation:

S.No.

Best Semiconductor Stocks in India (as per market capitalisation)

1.

HCL Technologies

2.

Bharat Electronics Limited

3.

ABB India Limited 

4.

Havells India Limited 

5.

Vedanta

*Our stock selection criteria for top stocks based on Market Capitalisation are mentioned at the bottom of this blog.

Overview of Best Semiconductor Stocks in India 

Here is a brief overview of the semiconductor stocks listed above-

1) Bharat Electronics Limited 

Founded in 1954 under the Ministry of Defence, Bharat Electronics Limited (BEL) was established in India to meet the specific electronic requirements of the Indian Defence. The company provides a wide range of products, including defence communication items, land-based radars, naval systems, electronic warfare systems, avionics and more. 

Moreover, BEL aims to expand its business beyond defence, focusing on sectors like civil aviation, anti-drone systems, satellite assembly & integration, medical electronics and others. Headquartered in Bangalore, BEL exports its products globally to regions such as Europe, Asia, Africa, North America and the Middle East.

2) CG Power and Industrial Solutions Limited 

CG Power and Industrial Solutions Limited (formerly known as Crompton Greaves Limited) was established in 1937. It is an Indian company that designs, manufactures and sells equipment for power generation, distribution, transmission and rail transportation. 

The company operates through 2 segments: Power Systems and Industrial Systems. The Power Systems segment manufactures electric equipment for both power and industrial sectors, including transformers, reactors and switchgear products. The Industrial Systems segment focuses on producing and selling power conversion equipment which includes medium and low-voltage rotating machines, drives, stampings and equipment for Indian railways.

Semiconductor Stocks Fun Facts - Groww

3) Hitachi Energy India Limited 

Formerly known as  ABB Power Products and Systems India Limited (APPSIL), Hitachi Energy India Limited was established as a Public Limited Company in Bengaluru on February 19, 2019. It is a key player in the power technology sector, known for its wide-ranging energy technology offerings. 

The company provides various products and solutions, including asset and work management, cable accessories, communication networks, cooling systems, energy storage, generators, circuit breakers, semiconductors, instrument transformers, surge arresters, etc. Additionally, it provides services such as the installation of electric grids, asset assessment and security, asset maintenance, upgrades, repairs and more.

4) V Guard Industries Limited 

Located in Kochi, V-Guard Industries Limited is a versatile company serving the mass consumption market. It manufactures and trades a wide array of electronics, electrical and consumer durables. 

V-Guard's product line includes voltage stabilisers, inverters, inverter batteries, solar water heaters, distribution boards, wiring cables, domestic pumps, agricultural pumps, industrial motors,  fans, gas stoves, domestic switch gears, industrial cables, induction cooktops, mixer grinders, etc. During the period 2022-23, the company acquired 100% ownership of Sunflame Enterprises Private Limited, making it a wholly-owned subsidiary.

5) Havells India Limited 

Havells India Limited is a renowned power distribution equipment manufacturer and a leading Fast Moving Electrical Goods (FMEG) company worldwide. It provides a wide range of products, including circuit protection devices, cables, motors, fans, switches, home appliances and more. The company owns renowned brands like Havells, Lloyd, Crabtree and Standard. 

With a network of over 14,000 dealers and 35 branches in India, its products are available in 60+ countries. Over 90% of Havells’ products are manufactured in-house and are energy-efficient. Furthermore, it also provides doorstep service through 'Havells Connect' and runs over 700 Havells Exclusive Brand Stores nationwide.

Factors to Consider Before Investing in Semiconductor Stocks in India

The following are some essential factors to consider before buying the semiconductor shares in India:

  • Financial Performance

Evaluate the financial performance of the semiconductor company stocks. Look at metrics like revenue growth, profitability and debt levels to understand the company's overall financial health.

  • Stay Informed on Market Trends

Stay up-to-date with market trends and global demand for semiconductor stocks in India. Be aware of industry shifts, geopolitical factors and emerging technologies to make informed investment decisions.

  • Diversification Strategy

Spread your investments across different sub-sectors within the semiconductor industry to mitigate risks associated with market volatility. Whether you invest in memory chips or processors, a diversified portfolio can protect against sector-specific challenges.

  • Monitor Regulatory Environments

Be aware of regulatory changes that may impact semiconductor stocks in India, both domestically and internationally. Changes in policies can have significant implications for the industry, influencing investment outcomes.

  • Supply Chain¬†

Any disruptions in the semiconductor supply chain can drive up its sales and share prices. Monitor all the stocks carefully and avoid the ones associated with delayed product launches, reduced revenues and higher prices due to supply chain issues. 

Should You Invest in Semiconductor Stocks?

While the semiconductor industry offers a compelling opportunity due to its integral role in advancing technology, it is crucial to understand the associated risks before making investment decisions.

Firstly, semiconductor blue chip stocks in India can be highly volatile due to changes in demand, technological advancements and market trends. This volatility makes it challenging to predict future returns. Additionally, the Indian semiconductor market is highly competitive, with numerous companies competing for market share. This competition often results in price wars and reduced profit margins, ultimately negatively impacting stock prices. 

Moreover, semiconductor manufacturing industries are cyclical, meaning they go through periods of growth and decline. This cyclicality adds to the uncertainty of investing in semiconductor stocks in India. Therefore, it is crucial to carefully assess these risks and consider diversifying your investment portfolio before buying semiconductor shares. 

Concluding Note

Investing in top semiconductor stocks in India can offer substantial growth in future due to its strong demand driven by technological advancements. With thorough research and careful consideration, investing in semiconductor stocks in India can help yield significant returns in the long run.

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*Stock Selection Criteria for Top Stocks Based on Analyst Rating

Investors must carefully read through the following information on stock selection criteria while running through the stocks based on analyst ratings-

These stocks have been shortlisted as per Analyst ratings provided by the I/B/E/S (The Institutional Broker’s Estimate System) database, further aggregated by Refinitiv. Ratings are determined by analysts' forecasts of company performance, taking into account metrics like earnings per share, sales, and net income. These ratings should not be construed as investment advice/recommendations/offer/solicitation of an offer to buy/sell any securities by Groww Invest Tech Pvt. Ltd. (formerly known as Nextbillion Technology Pvt. Ltd.).  

Before investing, investors must conduct independent research and not solely rely on the information provided here. This will allow investors to make appropriate investment decisions based on their financial goals, investment objectives and risk tolerance.

*Stock Selection Criteria for Top Stocks Based on Market Capitalisation

These stocks are chosen based on their market capitalization, which represents the total value of a company's outstanding shares. The selection is arranged in descending order, placing the largest companies first and the smaller ones later. This helps prioritize stocks based on their market size. 

It is important to note that market capitalization in no way guarantees a company’s performance or the returns from its stocks. However, it can be used as a criterion for shortlisting companies from within a sector. Investors should recognize that other factors, such as financial health, management efficiency, and market trends, play crucial roles in determining the actual success of an investment. 

This stock selection should not be construed as investment advice/recommendations/offer/solicitation of an offer to buy/sell any securities by Groww Invest Tech Pvt. Ltd. (formerly known as Nextbillion Technology Pvt. Ltd.).

Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.

To read the RA disclaimer, please click here
Research Analyst - Aakash Baid

Disclaimer

The stocks mentioned in this article are not recommendations. Please conduct your own research and due diligence before investing. Investment in securities market are subject to market risks, read all the related documents carefully before investing. Please read the Risk Disclosure documents carefully before investing in Equity Shares, Derivatives, Mutual fund, and/or other instruments traded on the Stock Exchanges. As investments are subject to market risks and price fluctuation risk, there is no assurance or guarantee that the investment objectives shall be achieved. Groww Invest Tech Pvt. Ltd. (Formerly known as Nextbillion Technology Pvt. Ltd) Ltd. do not guarantee any assured returns on any investments. Past performance of securities/instruments is not indicative of their future performance.
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