Electronics cos charged up for big revenue boost
manufacturing services (EMS) industry revenues are set to more than double to reach $55 billion by FY27, driven by increased sourcing of components locally, with Apple, Samsung, Lenovo and other global companies expected to expand their presence in India.
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A BNP Paribas report expects Apple to expand its investment to $40 billion in the next 4-5 years to significantly increase its production capacity in India, while Korean major Samsung is looking to expand its manufacturing presence by producing laptops, in addition to smartphones. The report added that IT hardware major Lenovo is planning to make servers in India to support its growing data centre business, leveraging the production-linked incentive (PLI) scheme for IT hardware. Other global companies such as Acer, HP, and Nokia are also expanding their presence in India, BNP Paribas said.
According to the report, the total addressable market for domestic EMS players, estimated to be at $40 billion as of FY23, is expected to grow at 27% CAGR to reach $100 billion by FY27 on the back of declining import of finished goods (at 3% CAGR), and growing component production — currently growing at 13% CAGR — to surge to 19% CAGR in FY23-27.
«While pace of imports of finished goods (particularly mobiles, TVs, and ACs) has slowed in recent years, the electronics industry remains dependent on imports, especially for consumer and industrial electronics components, IT hardware and LED components,» the report said.
The report said the
