Semiconductor stocks in India have been a hot topic in the investment world lately due to their rapid growth potential. As technology continues to evolve and digitalization becomes the norm, the demand for semiconductor products has increased rapidly. This has made semi conductor stocks a great investment option for investors. In this blog, we’ll dive into everything you need to know about semi conductor stocks India and how to invest in them.
What are Semiconductor Stocks?
Semiconductor stocks refer to stocks of companies that design, develop, and manufacture semiconductors. Semiconductors are electronic components that control the flow of electricity in devices like smartphones, computers, and other electronic gadgets. There are different types of semiconductor stocks, called semiconductor chips which include memory chips, microprocessors, and other types of electronic chips.
Semiconductor stocks in India are important for the economy because they play a vital role in the growth of the technology sector. The demand for electronic devices is constantly increasing, and semiconductor companies are at the forefront of innovation to meet this demand.
Top Semiconductor Stocks List 2023
he best semiconductor stocks in India pave the way for transformative technologies. Therefore, we have listed down semiconductor stocks to buy in 2023. The list includes semiconductor stock prices and market capitalization of companies.
|Stock Name||Market Cap (in Cr)||Share Price|
|Bharat Electronics Ltd||₹98,353.07||₹133.2|
|ABB India Ltd||₹92,094.32||₹4,381.55|
|Havells India Ltd||₹84,820.60||₹1,384.55|
|Polycab India Ltd||₹75,584.11||₹5,123.05|
|CG Power and Industrial Solutions Ltd||₹62,525.86||₹429.35|
|Bharat Heavy Electricals Ltd||₹41,332.09||₹121.25|
|Honeywell Automation India Ltd||₹35,472.68||₹39,643.7|
|Apar Industries Ltd||₹19,011.85||₹5,008.45|
|Hitachi Energy India Ltd||₹18,881.46||₹4,400.95|
|V Guard Industries Ltd||₹13,716.83||₹314.35|
Note: The data is from 30th August, 2023. However, for real-time updates on stock prices and market trends, visit the smallcase stocks collection today!
Semiconductor Industry in India – Overview
The semiconductor industry in India is growing rapidly.
The Indian semiconductor market was valued at approximately $23.2 billion in 2022 and is projected to reach $80.3 billion by 2028, growing at a compound annual growth rate (CAGR) of 17.10% during the forecast period.
The Indian government has taken several initiatives to boost the semi conductor stocks market in India, such as:
- The setting up of the $10 billion Semiconductor Fabs Incentive Scheme (SFMIS) to attract semiconductor manufacturing companies to India.
- The introduction of the Production Linked Incentive (PLI) scheme for the semiconductor and display manufacturing sector.
- The setting up of the India Semiconductor Mission (ISM) to coordinate the development of the semiconductor industry in India.
How to Invest in Semiconductor Stocks?
You can invest in small cap semiconductor stocks through various methods, including purchasing individual stocks, investing in semiconductor exchange-traded funds (ETFs), or putting your money into semiconductor mutual funds. Investors should also conduct research and keep themselves updated on the latest trends and developments in the semiconductor industry in India to make informed investment decisions.
However, if you’re confused about which stocks to pick, you can explore smallcases:
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- They’re created and managed by SEBI-registered experts,
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- Some of the popular smallcases among new investors are as follows:
Disclosures for aforementioned smallcases
Semiconductor Companies Stocks in India
Let’s have a look at the best semiconductor manufacturing companies.
Bharat Electronics Ltd
Bharat Electronics is a leading Indian defense electronics company under the Ministry of Defence. It specializes in the design, manufacture, and supply of advanced electronics systems, ranging from radars and sonars to communication equipment and weapon systems. BEL plays a crucial role in enhancing India’s defense capabilities and self-reliance in electronics technology.
- Moderate Risk: Stock is 2.47x as volatile as Nifty
- Largecap: With a market cap of ₹98,353 cr, the stock is ranked 58
ABB India Ltd
ABB India is a prominent technology company specializing in power and automation solutions. As a subsidiary of the global ABB Group, it offers a wide range of products and services, including robotics, electrification, industrial automation, and digital solutions, catering to diverse industries such as utilities, manufacturing, and infrastructure.
- Moderate Risk: Stock is 2.56x as volatile as Nifty
- Largecap: With a market cap of ₹92,094 cr, the stock is ranked 65
Havells India Ltd
Havells is a well-established Indian company known for its electrical equipment and consumer goods. With a focus on innovation and quality, Havells produces a variety of products ranging from switches, cables, and circuit protection devices to lighting solutions and home appliances, serving both domestic and international markets.
- Moderate Risk: Stock is 2.04x as volatile as Nifty
- Largecap: With a market cap of ₹84,820 cr, the stock is ranked 70
Advantages of Investing in Semiconductor Stocks in India
There are multiple reasons why you should invest in top semiconductor stocks in India. Thus, some of them have been listed below:
- High Growth Potential: Semiconductor companies stocks in India operate in a rapidly evolving industry. The demand for semiconductor stocks is constantly increasing due to the rising popularity of electronic devices. As a result, the top semiconductor stocks in India have the potential to generate high returns for investors.
- Diversification: Investing in the best semiconductor companies can help diversify your portfolio. Various industries, including healthcare, automotive, and consumer electronics, use semiconductors. This diversification can help mitigate risks associated with investing in a single industry.
- Technological Innovation: Semi conductor stocks are constantly innovating to keep up with the demands of the market. Investing in these companies can provide exposure to cutting-edge technologies, such as artificial intelligence and 5G.
Risks Associated with Investing in Semi Conductor Stocks
Here is a list of possible challenges while investing in semi conductor stocks in India.
- Volatility: The Indian semiconductor industry can be highly volatile. Changes in demand, technological advancements, and stock market trends often affect them. This volatility can make it difficult to predict future returns.
- Competition: India semiconductor market is highly competitive, with many companies vying for market share. This competition can lead to price wars and reduced profit margins, which can negatively impact stock prices.
- Cyclical Nature: The semiconductor manufacturing industries are cyclical, meaning that they go through periods of growth and decline. This cyclicality can make it difficult.
Things to Consider Before Investing in Semiconductor Shares
Before diving into manufacturing semiconductor investments, considering the following factors are crucial.
- The semiconductor share price is the value of a single share of a semiconductor company. Calculate it by dividing the company’s total market capitalization by the number of outstanding shares. Several factors can influence semiconductor share prices, including the demand for semiconductors, market trends, global economic conditions, and technological advancements.
- There are several semiconductors stocks to choose from, and investors should consider various factors when choosing the best semiconductor manufacturing companies. These factors include the company’s financial stability, market performance, growth potential, and dividend payout.
- Investors should also stay mindful of the risks associated with semiconductor business, such as market fluctuations in the semiconductor industry and alterations in global trade policies.
Understanding these factors and monitoring them is essential for successful investing in semiconductor shares.
To Wrap It Up…
In conclusion, semiconductor shares offer significant growth potential for investors looking to invest in the technology sector. Understanding the semiconductor market in India, choosing the right semiconductor manufacturers, and knowing how to invest in semi conductor stocks is essential for successful investing in this field. With the right research and investment strategy, portfolio investing of semiconductor shares can be a profitable investment opportunity for investors.
Here are the best semi conductor stocks in India that you can invest in – Bharat Electronics Ltd, ABB India Ltd and Havells India Ltd. However, it’s important to do your research or consult a financial advisor before investing.
You can invest in semiconductor stocks in India through a stockbroker or a mutual fund. Here are the steps involved:
1. Open a trading account with a stockbroker.
2. Fund your account.
3. Research semiconductor stocks and choose the ones you want to invest in.
4. Place a buy order for the stocks you have chosen.
Yes, it is a good time to invest in semiconductor stocks in India, as the demand for semiconductors is expected to grow in the coming years.
Investors who have a long-term investment horizon and are willing to take on some risk should consider investing in semi conductor stocks in India.
All the factors are projected to drive the India semiconductor market to achieve a USD 55 billion valuation by 2026, with an anticipated compound annual growth rate (CAGR) of 20% during the 2022-2026 period.
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