In this blog we will discuss about the most critical issue of semiconductors and how the semiconductor shortages affected the manufacturing of the Indian Auto Makers and presently which are the companies directly involved in manufacturing of semiconductors and planning to enter into semiconductor industry.
You must have heard about the chip shortages after the outbreak of Covid-19 and the chip shortages are witnessed globally resulting into delay in the delivery, price hikes. These chips / semiconductors plays very important role in all the electronic devices used right from the computers to home appliance to automotive sector.
To understand the worldwide semiconductors shortages issue & it’s severity I will apprise you that the world’s biggest automakers like General Motors (GM) has forced to shut down it’s auto manufacturing facilities/ plants temporarily. I hope you must have heard this news few days back so that much severe is the issue of semiconductors shortages. The General Motors has lost approximately $2 Billion due to this issue.
The change in lifestyle has further increased the demand of semiconductors in all electronics devices after Covid-19 outbreak in globally & the demand supply disruption, global lockdowns, work from home culture etc further are the factors for imbalance in demand and supply.
You must be wondering that these chips / semiconductors are used in electronic devices then why we are coming across the news that the due to semiconductors shortages the automakers are getting affected? So your question is but obvious and here is the answer for your question “as the cars are becoming more and more computerised they require both basic semiconductors and advanced semiconductors during the manufacturing of cars.” The issue is not limited to US or General Motors it has affected the manufacturing across Europe, Japan and big giants such as VW Group, Honda etc also had forced to shut their units / cut production.
To encourage the semiconductors manufacturing within India the Govt has sectioned Rs. 76000 crores under production linked incentive (PLI) scheme looking at the chips shortage issues globally resulting in output across industries like car manufactures, mobile manufactures, laptop manufactures etc.
So at this you have understood the criticality of the semiconductors issue and now we will be discussing the top semiconductors manufactures in India / emerging semiconductors manufactures in India. As the supply and demand issue is likely to continue for few years and hence the growth across semiconductors industry is visible so you can look for the opportunities to invest in these stocks.
Top Emerging Players in Manufacturing of Semi Conductors:-
- Vedanta Limited (Vedanta)
Vedanta will choose a location in India for its $20 billion semiconductors and display plants by mid-June, and the first chip product will be available in two years, according to Chairman Anil Agarwal.
Vedanta, an oil-to-metals conglomerate, stated in February that it would diversify into chip production and form a joint venture with Foxconn of Taiwan to support Prime Minister Narendra Modi’s aim to make India a semiconductor manufacturing hub.
So Vedanta is an emerging player in the semiconductor industry and will come up with it’s products in 2 years time.
The shares of Vedanta Limited is in correction phase and already corrected nearly 40% and still we can expect some more correction as marked in the below technical chart. So looking at the semiconductor business and present company business it’s very good opportunity to grab the Vedanta shares for portfolio in the range of 240 to 280. Accumulation of shares of Vedanta will drive the value of portfolio multifold in years to come.
- Tata Elxi Limited (Tataelxi) : –
Tata Elxsi is amongst the world’s leading providers of design and technology services across industries including Automotive, Media, Communications and Healthcare. Tata Elxsi provides integrated services from research and strategy, to electronics and mechanical design, software development, validation and deployment, and is supported by a network of design studios, global development centers and offices worldwide.
Tata Group is planning to set up a semiconductor manufacturing unit in India with $300 million investment plans. The Tata Group is reportedly in discussions with several states to identify states to identify the land to build a USD 300 million chip making unit.
Tata Elxi is the relatively good company to enter in to this business looking at the present business profile of the company.
Look at the below technical chart of Tata Elxi the share price of Tata Elxi is in an uptrend and this the good company to accumulated in your portfolio at current levels and every decline for excellent portfolio returns.
Now going ahead we will discuss the existing semiconductors manufactures in India
Top Semiconductors Manufacturing Companies in India:-
- Bharat Electronics Limited (BEL) :
Bharat Electronics Limited (BEL) is a Navratna PSU under the Ministry of Defence, Government of India. It manufactures state-of-the-art electronic products and systems for the Army, Navy and the Air Force. BEL has also diversified into various areas like homeland security solutions, smart cities, e-governance solutions, space electronics including satellite integration, energy storage products including e-vehicle charging stations, solar, network & cyber security, railways & metro solutions, airport solutions, Electronic Voting Machines, telecom products, passive night vision devices, medical electronics, composites and software solutions.
BEL is the oldest semiconductors manufactures in India.
On technical charts share price of BEL is showing strength and the stock is in an uptrend and can be accumulated in the range of 200-220 for excellent returns and must have in portfolio.
- Moschip Technologies Ltd
Established in 1999, MosChip was the First Fabless Semiconductor company publicly traded in India with approx.20 years of experience. MosChip is a semiconductor and system design company with a focus on Turnkey ASICs, Mixed Signal IP, Semiconductor & Product Engineering, and IoT solutions catering to Aerospace & Defence, Consumer Electronics, Automotive, Medical, and Networking & Telecommunications.
Over the past 2 decades, MosChip has developed and shipped millions of connectivity ICs. MosChip’s IoT solutions like Smart Lighting, Smart Metering, and Asset Tracking are successfully deployed in volume.
On technical charts the shares of MosChip Technologies showing weakness and currently trading near support zone, as the company size is small the investors have to be choosy while selecting this stock into the portfolio. Recently the company has shown out perfornace in it’s business and hence can be a good opportunity to buy in between 35 – 50 levels.
- Ruttonsha International Rectifier Ltd
Ruttonsha International Rectifier Ltd. (BSE : RIR) is a global landmark in Semiconductors having 25 years (two and a half decades) of technical collaboration with International Rectifier Corp., USA, for manufacturing of Power Semiconductors.
On Technical charts the shares of Ruttonsha International given a multi fold returns to the investors however as the shares raised sharply the correction also came in a big way. The shares can be accumulated at around 200 levels and can be a good opportunity if comes down further. The financial performance of the company is in an improving stage.
Disclaimer : – The contents posted here are only for Educational purpose and do not treat them as a recommendations.
