For equity allocators tracking India’s Electronics Manufacturing Services (EMS) explosion, the initial wave of growth was driven by surface-level box-building and final assembly- activities characterized by low capital intensity, low single-digit operating margins, and extreme reliance on imported sub-assemblies. The Ministry of Electronics and Information Technology’s (MeitY) latest approval tranche under the Electronic Component Manufacturing Scheme (ECMS) signals an intentional migration toward deep-tech component localization.
Under the 5th tranche of the Electronic Component Manufacturing Scheme (ECMS) cleared by MeitY on August 17, 2026, the government approved 31 proposals involving ₹7,877 crore in investments across 10 states. This brings cumulative approvals under ECMS to 106 projects across 15 states, representing ₹69,548 crore in committed capex and a projected production output of ₹5,34,101 crore. For institutional portfolios, this scheme is not merely an import-substitution exercise; it is an margin-expansion driver for select auto-ancillary and capital goods players transitioning from component buyers to integrated component owners.
Below is the detailed list of the prominent companies and project proposals approved in this tranche, grouped by product segment and technical application:
1. Capital Goods & Industrial Automation
- Jyoti CNC Automation: ₹1,021 crore investment for manufacturing electronic capital goods (in-house CNC controllers, servo drives, motors, and HMIs).
- VVDN Technologies: ₹100 crore investment for electronic capital goods and complex sub-assemblies.
- Mitsubishi Electric India: ₹99 crore investment for industrial automation hardware and drive control systems.
- Ind Sphinx Precision: Micro-drilling tools and consumables used in PCB manufacturing.
- Accurate Gauging and Instruments: Precision measuring equipment and quality-control capital tools.
2. Displays, Cameras & Cockpit Electronics
- Bhagwati Products (TXD India / Micromax): ₹450 crore investment specifically for mobile display module manufacturing.
- Minda Instruments (Minda Corp): ₹270 crore investment for automotive Thin-Film Transistor (TFT) display module assemblies.
- TKB Optics: Display module sub-assemblies for automotive and consumer electronics.
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3. Advanced Materials, Substrates & Speciality Chemicals
- Wipro Global Engineering & Electronic Materials: ₹1,033 crore additional investment commitment (taking total ECMS commitment to ₹1,401 crore) for Copper-Clad Laminates (CCL) used in AI servers and high-density PCBs.
- PCBL Chemical (RPSG Group): ₹329 crore investment for acetylene black production (used as conductive additive in lithium-ion batteries and electronic parts).
- Acutaas Chemicals: ₹119 crore investment for specialized electrolyte additives.
- Quantum Magnetics: Manufacturing of rare-earth permanent magnets (replaces Chinese import dependence for high-end speakers and motor drives).
4. Precision Enclosures, Mouldings & Heavy Sub-Assemblies
- SkyQuad Electronics & Appliances (Resolute Group): ₹740 crore investment for high-density electronic component sub-assemblies.
- Micromax Precision Moulding: ₹565 crore investment for unit enclosures, structural parts, and precision mouldings at Greater Noida.
5. Coils, Passives, Connectors & Sensors
- Syrma SGS Technology: ₹60 crore investment for specialized magnetic coil manufacturing.
- Centum Electronics: ₹50 crore investment for inductors, coils, and specialized defense/industrial electronics.
- Globe Capacitors: Capacitors, metallised films, and motor-run passives.
- Ennovi Mobility Solutions: Automotive interconnects, battery joinery, and mobility connectors.
- Rosenberger Interconnect: High-frequency RF connectors and cable assemblies.
- Sensata Technologies: Sensors, thermal protection, and electromechanical controls.
- Allied Engineering Works: Interconnects, electromechanical switches, and terminal components.
6. Ecosystem Majors & Specialized Components
- Kaynes Technology: Printed Circuit Board (PCB) plant expansion going live shortly.
- Motherson Group: Electronic components and wiring interconnect facility at Kanchipuram.
- Dixon Technologies: Approved component/sub-assembly facility expansion.
- GX Group: Fiber access components, optical transceivers, and networking hardware.
- Britannia RFID Technologies: RFID smart tags, transponders, and tracking labels.
First-Time Domestic Manufacturing Approvals: First-in-India local production cleared for acetylene black, electrolyte additives, rare-earth permanent magnets, coils/filters, and hermetic terminals.
The central mandate of ECMS is to bridge the “value-addition deficit”. While India has achieved near-100% local assembly in several finished product categories, local value addition historically hovered at a meagre 15% to 20%.
For example lets look at the…
Automotive Display Modules:
Modern electric and internal combustion vehicles are rapidly shifting toward software-defined cockpits, where traditional analog dials are replaced by large Thin-Film Transistor (TFT) display clusters. Until now, Indian Tier-1 suppliers imported pre-assembled display sub-modules from China, Taiwan, and South Korea, leaving them exposed to supply chain bottlenecks and margin compression.
- Minda Corporation (Minda Instruments): Secured approval to build a greenfield TFT display module assembly plant under ECMS. By localizing display module sub-assemblies in-house, Minda transitions from a pure cluster integrator into a core component manufacturer. This move directly shortens supply lines, insulates operating margins against currency fluctuations, and allows Minda to capture supply contracts across external automotive OEMs.
- TKB Optics: Received approval in the same round for display module sub-assemblies. Together with Minda, TKB Optics establishes the foundational domestic display ecosystem required to serve India’s expanding automotive and consumer electronics markets.
What to Watch Out For
- Execution Timelines & Milestone Discrepancies: ECMS incentives are strictly tied to achieving concrete capex and turnover milestones. Investors should track the execution of greenfield projects to ensure capital deployment stays on schedule.
- Working Capital and Scale-Up Risks: Shifting from component sourcing to in-house component fabrication increases front-end inventory and working capital requirements during the initial 12 to 18 months of plant commissioning.
The long-term takeaway for equity portfolios is straightforward: the primary investment thesis in Indian electronics is shifting from simple assembly scale toward deep component ownership. Companies leveraging ECMS subsidies to build proprietary in-house sub-component capabilities are best positioned to defend their balance sheets and command sustainable valuation premiums.
Data Source & Reference: Press Information Bureau (PIB) Press Release & Ministry of Electronics and Information Technology (MeitY) Notifications, August 17–18, 2026. Official statements by Ashwini Vaishnaw (Union Minister for Electronics & IT) and S. Krishnan (IT Secretary). Company regulatory filings and Q1 FY27 earnings transcripts.