‘Domestic value addition in electronics manufacturing can reach 30% soon’

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Mint. To do this, the industry is seeking a production-linked incentive (PLI) scheme for component manufacturing, even as Vachani believes that contract manufacturers should start looking at how to expand their market share in order to export devices globally. “It’s important to understand that even China’s domestic value addition in manufacturing is around 45%, because even China imports nearly all of its semiconductors for mobile manufacturing.

All of this is work in progress, which will take time," Vachani said. On Monday, share prices of the contract manufacturer hit an all-time high of ₹7,045 apiece, driven by the company winning a mobile phone manufacturing contract, and also opening an appliances factory in Dehradun last week. The company’s share price has surged 2.6x in one year, as a Centre-backed push has seen India look for more localization in electronics production.

To do this, Vachani said that the company is set to open a mobile phone manufacturing plant in Noida—a “megafactory" with “nearly 1 million square feet of space". The plant with the capacity to manufacture 25 million mobile phone units annually, is expected to reach full capacity by March next year, Vachani said. The company is also looking to capture a large chunk of India’s laptop manufacturing demand, which has risen from the introduction of the revised IT hardware PLI scheme.

“A lot of chip firms are working with local companies to design laptops here, which will lead to interesting results in the next two to three years. Dixon has a partnership with Acer for laptop manufacturing, while Lenovo’s factory is being set up. Laptops represent a very large market in India—IT hardware imports are to the tune of $10 billion.