The shares of Electronic Manufacturing Services (EMS) companies jumped on September 1 as Prime Minister Narendra Modi's visit to China boosted investor sentiment.
EMS companies have strong ties with Chinese component manufacturers. The earlier tensions between India and China following geopolitical disputes had impacted the stocks, as investors remained concerned over supply chain disruption.
Prime Minister Narendra Modi attended the Shanghai Cooperation Organization (SCO) summit in Tianjin, China. At the summit, he met Chinese President Xi Jinping and Russian President Vladimir Putin. This holds strong significance in global geopolitics after US President Donald Trump's administration increased tariffs on Indian imports to a whopping 50 percent.
Kaynes Technology shares gained nearly 8 percent to trade at Rs 6,595 apiece. The company imports most of its raw materials from outside, including various electronic components that are mostly sourced from China. The easing tensions between India and China after PM Modi's visit will likely boost the stock, on expectations of easing impact on supply chains.
Dixon Technologies (India) shares jumped around 6 percent to close at Rs 17,625 apiece. Earlier this year, Dixon Technologies formed a joint venture with China's HKC to produce display modules by September 2025. The company is also exploring similar partnerships for precision components, mechanicals, camera modules, and battery packs.
"We have hired a senior resource and are building a team to execute these projects. The component PLI rollout by the government will strengthen our backward integration and open a massive market for Dixon," said Managing Director Atul Lall during the company’s Q3 earnings call.
Notably, Dixon Tech in 2023 had announced a major partnership with Chinese smartphone brand Xiaomi, the Beijing-headquartered company which has faced heightened scrutiny over the years in India over souring ties with China.
Amber Enterprises India shares meanwhile surged around 5 percent to end the session at 7,621.50. PG Electroplast shares rose over 4 percent to close at Rs 556 apiece.
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