Top Semiconductor Stocks Listed on NSE to Buy in the Share Market in India for 2024
As technology evolves and digitalisation becomes the norm, the demand for semiconductor products has been on an upward curve recently, making semiconductor stocks an exciting investment option. In this blog, we’ll explore the top semiconductor stocks in India’s NSE and how to invest in them. We will also explore their future, features, benefits and factors to consider when investing in semiconductor stocks!
Top Semiconductor Stocks in India Listed in NSE for 2024
| Stock Name | Market Cap (in Cr) | Share Price | Return on Equity (ROE) | 1Y Returns |
|---|---|---|---|---|
| CG Power and Industrial Solutions Ltd | ₹1,17,982 | ₹775.55 | 59.33% | 98.69% |
| Tata Elxsi Ltd | ₹43,932 | ₹7,027.95 | 34.51% | 5.78% |
| Polycab India Ltd | ₹99,742 | ₹6,568.85 | 23.92% | 87.05% |
| HCL Technologies Ltd | ₹4,11,452 | ₹1,514.60 | 23.31% | 35.12% |
| ABB India Ltd | ₹1,83,923 | ₹8,529.35 | 22.82% | 98.63% |
| Bharat Electronics Ltd | ₹2,36,873 | ₹329.80 | 22.80% | 163.46% |
| Dixon Technologies (India) Ltd | ₹74,829 | ₹12,456.00 | 22.31% | 195.06% |
| Havells India Ltd | ₹1,18,716 | ₹1,870.20 | 18.06% | 46.66% |
| V Guard Industries Ltd | ₹20,719 | ₹487.25 | 12.52% | 64.37% |
| Vedanta Ltd | ₹1,75,819 | ₹468.00 | 9.27% | 67.88% |
Disclaimer: Please note that the above list is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.
Note: The data in this semiconductor stocks list, including the semiconductor share price, is from 5th July, 2024. This data is derived from Tickertape Stock Screener.
🚀 Pro Tip: You can use Tickertape’s Stock Screener to research and evaluate stocks with over 200+ filters and parameters.
Overview of the Semiconductor Stocks Based on 5-yr CAGR
Let’s look at the best semiconductor manufacturing companies in India listed in NSE and a brief overview of the semiconductor shares India listed in the semiconductor share list above:
CG Power and Industrial Solutions Ltd
CG Power and Industrial Solutions Limited is also known as Crompton Greaves Limited. It is an Indian multinational company headquartered in Mumbai. It designs, manufactures, and markets products for power generation, transmission, distribution, and rail transportation. In 2020, the Chennai-based Murugappa Group acquired the company from the Avantha Group. Over the last 5 years, the company’s revenue has grown at a yearly rate of 1.7%, higher than the industry average of 0.15%, and its market share increased from 12.4% to 14.61%.
Tata Elxsi Ltd
Tata Elxsi Ltd. offers design and technology services to industries such as automotive, media, communications, healthcare, and transportation. The company operates in two main segments: Software Development and Services and Systems Integration and Support Services. Over the last five years, its revenue has grown at a yearly rate of 17.5%, higher than the industry average of 14.48%, and its market share increased from 4.92% to 5.61%.
Polycab India Ltd
Polycab India Ltd. manufactures and sells electric wires and cables. The company operates in three main segments: Wires and Cables, Fast-Moving Electrical Goods (FMEG), and International Business. Over the last five years, the company’s revenue has grown at a yearly rate of 17.8%, higher than the industry average of 9.53%, and its market share increased from 14.5% to 20.68%.
HCL Technologies Ltd
HCL Technologies Ltd. is a technology company that offers computer programming, consultancy, and related activities. It operates in three segments: Information Technology and Business Services (ITBS), Engineering and Research and Development Services (ERS), and Products and Platforms. Over the last 5 years, the company’s revenue has grown at a yearly rate of 12.67%, higher than the industry average of 11.54%, and its market share increased from 13% to 14.24%.
ABB India Ltd
ABB India Ltd. manufactures electric motors, generators, transformers, and electrical distribution and control equipment. Its operations are divided into four segments: Motion, Robotics and Discrete Automation, Electrification, and Process Automation. As of 5th July, 2024 this largecap company’s market capitalisation is Rs. 1,83,923 cr., and its return on equity is 22.82%.
Bharat Electronics Ltd
Bharat Electronics Limited (BEL) is a government-owned Indian company specialising in aerospace and defence electronics. BEL is one of the sixteen public sector undertakings (PSUs) under India’s Ministry of Defence. It produces advanced electronic products for both ground and aerospace applications. As of 5th July 2024, the largecap company’s market capitalisation is Rs. 2,36,873 cr., and its ROE is 22.8%.
Dixon Technologies (India) Ltd
Dixon Technologies (India) Ltd. manufactures and sells electronic products. It offers consumer electronics like LED TVs, home appliances like washing machines, and lighting products, including LED bulbs, tube lights, downlighters, and compact fluorescent bulbs. It also produces mobile phones and provides after-sales services. Over the last 5 years, the company’s revenue has grown at a yearly rate of 42.75%, higher than the industry average of 11.31%, and its market share increased from 5.83% to 20.04%.
Havells India Ltd
Havells India Ltd. develops electrical and power distribution equipment. Its operations cover segments like switchgear, cables, lighting and fixtures, electrical consumer durables, and Lloyd Consumer. Over the last 5 years, the company’s revenue has grown at a yearly rate of 13.05%, higher than the industry average of 9.53%, and its market share increased from 18.38% to 21.34%.
V Guard Industries Ltd
V-Guard Industries Ltd. manufactures, trades, and sells electronic and electromechanical products. The company operates in three segments: Electronics, Electrical, and Consumer Durables. Over the last 5 years, the company’s revenue has grown at a yearly rate of 13.35%, higher than the industry average of 9.53%, and its market share increased from 4.71% to 5.54%.
Vedanta Ltd
Vedanta Ltd. is a natural resources company that is involved in exploring, extracting, and processing minerals, oil, and gas. It operates in segments including Copper, Aluminum, Iron Ore, Power, and Oil & Gas. Over the last 5 years, the company’s revenue has grown at a yearly rate of 9.26%, higher than the industry average of 9.04%, and its market share increased from 84.82% to 86%.
Investing in Semiconductor Stocks via smallcase
Did you know that you can invest in readymade semiconductor stock portfolios managed by SEBI-registered experts?
But, before that, let’s look at what smallcase is.
smallcases are portfolios of thematic stocks created and managed by SEBI-registered analysts. These modern investment products help investors invest in stock/ETF portfolios curated to represent a theme, strategy or objective.
Among 500+ smallcases, here are some of the top semiconductor stocks smallcases:
- Disclosures for Ancillary smallcase
- Disclosures for Electric Mobility smallcase
However, if you’re confused about which stocks to pick, you can explore smallcases:
- smallcases are readymade portfolios of stocks/ETFs, that are based on a theme idea or strategy
- They’re created and managed by SEBI-registered experts
- smallcase.com offers over 200+ stock portfolios, created by 180+ managers
- Some of the popular smallcases among new investors are as follows:
Disclosures for aforementioned smallcases
What are Semiconductor Stocks?
Semiconductor stocks refer to stocks of semiconductor companies listed in India that design, develop, and manufacture semiconductors. Semiconductors in India are electronic components that control the flow of electricity in devices like smartphones, computers, and other electronic gadgets.
Semiconductor stocks in India are important for the economy because they play a vital role in the technology sector’s growth. The demand for electronic devices is constantly increasing, and semiconductor companies in India are at the forefront of innovation to meet this demand.
Semiconductor Industry Stocks in India – Overview
The Indian semiconductor industry 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 government has taken several initiatives to boost the semiconductor shares 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 stocks.
Why Invest in Semiconductor Stocks?
Here are a few reasons why one can consider investing in semiconductor stocks:
- Investing in the best semiconductor stocks in India can present a compelling opportunity driven by their integral role in advancing technology. As the backbone of devices spanning smartphones to high-performance computing systems, semiconductor companies in India stand at the forefront of innovation. The sustained demand for their components, fueled by emerging technologies like artificial intelligence and 5G, underscores their enduring relevance in the market.
- Moreover, the best semiconductor stocks may offer diversification benefits within investment portfolios. Their performance is intricately linked to global economic trends and specific industry advancements, making them a dynamic asset class. Understanding the supply chain dynamics, including manufacturing capacities and geopolitical influences, provides investors with insights into potential market shifts.
- Semiconductor stocks in India also serve as valuable economic indicators, reflecting the health of technology and manufacturing sectors. Investors looking to enhance portfolio resilience and tap into the transformative power of technology should consider the informative role semiconductor stocks in India play in shaping investment strategies.
How to Invest in Semiconductor Stocks?
You can invest in semiconductor stocks in India through various methods, including purchasing individual semiconductor chip 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.
How to Choose the Best Semiconductor Stocks in India to Invest in?
You can follow the following tips in order to choose the best semiconductor stocks in India available in the market right now in India 2024:
- Evaluate Financial Health: Investors can begin by assessing the financial stability of potential semiconductor and display industry stocks. Investors can analyse metrics such as revenue growth, profitability, and debt levels to gauge the overall financial health of the semiconductor and display industry stocks in India that are under consideration.
- Assess Technological Edge: Investors may consider the technological prowess of each company. A robust history of research and development indicates innovation potential, a crucial factor in the ever-evolving semiconductor industry tied closely to technological advancements.
- Stay Informed on Market Trends: It may be wise to keep abreast of market trends and global demand for the best semiconductor stocks to buy in India. Understanding industry shifts, geopolitical influences, and emerging technologies can be essential for making informed investment decisions.
- Diversify Across Subsectors: Investors can try to mitigate risks associated with market volatility by diversifying across subsectors within the semiconductor industry. Whether it’s memory chips or processors, a diversified portfolio can provide a buffer against sector-specific challenges.
- Consider Financial Metrics: Investors can utilise financial metrics such as the price-to-earnings ratio and dividend yield. Consequently, gain insights into the valuation and potential returns of semiconductor stocks in India. However, bear in mind that historical performance does not guarantee future success.
- Stay Attuned to Regulatory Environments: Investors can try to be aware of regulatory environments that may impact the chip manufacturing companies in India, both domestically and internationally. Policy changes can have significant implications for the industry, influencing investment outcomes.
Features of the Top Semiconductor Sector Stocks in India
When exploring the landscape of the best semiconductor stocks in India, understanding the distinctive features of the leading companies becomes imperative. These characteristics contribute to their prominence in the market without implying any specific investment advice.
- Technological Innovation: Top semiconductor and display industry shares are characterised by their commitment to innovation. Companies at the forefront continually invest in research and development, staying ahead in the rapidly evolving semiconductor industry.
- Global Presence: Leading semiconductor companies in India often boast a global footprint. Their products and services are not confined to the domestic market, showcasing a robust international presence and engagement.
- Financial Health: Examining the financial health of India’s semiconductor stocks and chip manufacturers is crucial. Market leaders typically demonstrate stable financials, including healthy revenue streams, manageable debt levels, and consistent profitability.
- Strategic Partnerships: Collaboration and strategic partnerships are key features of top semiconductor sector stocks. Aligning with other industry leaders or forging alliances with tech giants may enhance their market position and facilitate mutual growth.
- Supply Chain Resilience: The resilience of the supply chain is a critical factor. Robust semiconductor companies have well-managed supply chains. This helps in mitigating potential disruptions and ensuring a steady flow of products to meet market demands.
Future of the Semiconductor Sector in India
India currently relies entirely on semiconductor imports, predominantly from Taiwan, China, Korea, and Vietnam, amounting to approximately $24 bn. Anticipated growth in India’s semiconductor market is projected to reach $63 billion by 2026, quadrupling its current size, driven by impending 5G adoption.
A recent governmental agreement with the European Union on semiconductor research and technology aims to bolster India’s semiconductor supply chain. This is to be done through collaboration in research, innovation, and talent development.
The Indian government has initiated several measures. Notably, it has allocated ₹76,000 crore under the Production-linked Incentive (PLI) scheme to support domestic semiconductor and display manufacturing. This initiative aims to establish around 20 semiconductor plants and promote design and component fabrication. Subsidies provided under the scheme will reduce manufacturing costs, encouraging increased production and potentially creating 35,000 direct and 100,000 indirect jobs.
Additionally, India’s ‘Semicon India Program’ invites international semiconductor firms to establish manufacturing facilities, offering up to 50% project cost coverage. This initiative has garnered interest from major global players like TSMC, Intel, and AMD, along with significant domestic investments, such as Tata Group’s $300 million plan and Vedanta’s $15 billion investment in semiconductor facilities.
Features of the Top Semiconductor Sector Stocks in India
When exploring the landscape of the best semiconductor stocks in India, understanding the distinctive features of the leading companies becomes imperative. These characteristics contribute to their prominence in the market without implying any specific investment advice.
- Technological Innovation: Top semiconductor and display industry shares are characterised by their commitment to innovation. Companies at the forefront continually invest in research and development, staying ahead in the rapidly evolving semiconductor industry.
- Global Presence: Leading semiconductor companies in India often boast a global footprint. Their products and services are not confined to the domestic market, showcasing a robust international presence and engagement.
- Financial Health: Examining the financial health of India semiconductor stocks is crucial. Market leaders typically demonstrate stable financials, including healthy revenue streams, manageable debt levels, and consistent profitability.
- Strategic Partnerships: Collaboration and strategic partnerships are key features of top semiconductor sector stocks. Aligning with other industry leaders or forging alliances with tech giants enhances their market position and facilitates mutual growth.
- Supply Chain Resilience: The resilience of the supply chain is a critical factor. Robust semiconductor companies have well-managed supply chains, mitigating potential disruptions and ensuring a steady flow of products to meet market demands.
Future of Semiconductors
Despite recent challenges, the semiconductor industry is poised for long-term growth, fueled by the relentless demand for electronics and technological advancements. This innovative sector has witnessed remarkable progress, with chips becoming exponentially more efficient and powerful over the past decades.
Given their widespread presence, it is unlikely that semiconductors will be replaced in the near future. Instead, they will continue to evolve and improve, driven by breakthroughs in materials science, such as the discovery and application of novel materials like graphene. Additionally, the emergence of quantum computing and photonic circuits may complement traditional semiconductors, further enhancing their capabilities.
The semiconductor industry’s resilience and adaptability ensure its continued relevance in the years to come. As technological advancements continue to shape the future, the demand for semiconductors will remain strong, driving growth and innovation in this critical sector.
Risks Associated with Investing in Semiconductor Shares
Here is a list of possible challenges while investing in the best semiconductor stocks in India.
- Volatility: The semiconductor stocks in India 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’s semiconductor market is highly competitive, with many Indian semiconductor companies vying for market share. This competition can lead to price wars and reduced profit margins, negatively impacting stock prices.
- Cyclical Nature: The semiconductor manufacturing industries are cyclical, meaning that they go through periods of growth and decline.
Advantages of Investing in Semiconductor Stocks in India
There are multiple reasons why you should invest in top semiconductor companies in India listed in NSE. Thus, some of them have been listed below:
- High Growth Potential: Semiconductor stocks in India operate in a rapidly evolving industry. The demand for these sector 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 mitigate risks associated with investing in a single industry.
- Technological Innovation: Semiconductor stocks in India are constantly innovating to keep up with the demands of the market. Investing in these semiconductor manufacturing companies can increase your exposure to cutting edge technologies and the growth potential associated with it.
Factors Affecting Semiconductor Stocks
Let’s look at the factors affecting semiconductor stocks.
- Global Chip Shortage: The worldwide shortage of chips has the potential to disrupt manufacturing processes and influence the performance of companies reliant on semiconductor components.
- Technological Advancements: The swift progress in chip technology has the capacity to render current technologies outdated, posing challenges for companies that have not kept pace with these advancements.
- Government Policies: Shifts in government policies concerning subsidies and regulations have the potential to affect the profitability of semiconductor firms, highlighting the importance of staying abreast of regulatory changes in the industry.
Factors to Consider Before Investing in Semiconductor Shares
Before diving into manufacturing semiconductor stocks to buy in India, consider the following factors are crucial.
- Semiconductor Share Price: The semiconductor share price is the value of a single share of a semiconductor company. Calculate it by dividing the company’s total market capitalisation by the number of outstanding semiconductor company shares in India. Several factors can influence semiconductor companies’ share prices. This includes the demand for semiconductors, market trends, global economic conditions, and technological advancements.
- Research the Semiconductor Companies: There are several semiconductor stocks to choose from. 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.
- Be Mindful of Risks Associated: Investors should also stay mindful of the risks associated with the semiconductor business, such as market fluctuations in the semiconductor industry and alterations in global trade policies.
Understanding and monitoring these factors is essential for successful investing in semiconductor shares. However, investors must do their own research or consult their financial advisor before investing.
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 semiconductor shares 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.
Frequently Asked Questions on Semiconductor Stocks
Based on the return on equity (ROE), here are the top semiconductor stocks in India:
(a) CG Power and Industrial Solutions Ltd
(b) Tata Elxsi Ltd
(c) Polycab India Ltd
(d) HCL Technologies Ltd
(e) ABB India Ltd
Note: The data in this list has been taken on 5th July, 2024.
You can invest in Indian semiconductor stocks through a stockbroker or a mutual fund. Here are the steps involved:
1. Open a trading account. Investors can open a demat/trading account with smallcase, as well!
2. Fund your account.
3. Research semiconductor stocks to buy in India and choose the ones you want to invest in.
4. Place a buy order for the stocks you have chosen.
Investors with a long-term investment horizon and willing to take on some risk can consider investing in semiconductor shares in India. However, one should always appraise market conditions and stock performance before buying them.
Semiconductors are categorised into two types: intrinsic semiconductors and extrinsic semiconductors. Intrinsic semiconductors are pure substances that do not contain any impurities or doping agents. In contrast, extrinsic semiconductors are created by introducing a controlled impurity to the pure semiconductor material.
The demand for semiconductors is expected to grow, and experts have observed a positive rise in the demand for semiconductors in recent years. However, this trend may or may not continue in the future. Hence, conducting thorough research and consulting a financial advisor before investing is always worthwhile.
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