The seven companies under Systematix' coverage are expected to report robust revenue/Ebitda/PAT growth of 88%/79%/99% YoY in Q4 FY25, respectively. This strong performance is likely to be driven by channel filling ahead of the summer season, aided by seasonal tailwinds. Growth momentum seems particularly strong in the room air conditioner segment, while a healthy volume ramp-up is also expected in the mobiles category. EMS companies are expected to post solid growth, supported by strong order inflows and an increasing focus on local value addition, positioning them well for sustained growth.
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Systematix Report
We remain positive on the EMS sector, supported by strong structural tailwinds and policy initiatives. Indian government's continued push to establish India as a global electronics manufacturing hub is driving long-term growth opportunities across the value chain.
In particular, efforts to build a domestic semiconductor ecosystem bode well for Kaynes, which stands out as one of the few players approved for the OSAT segment. At the same time, Dixon Technologies continues to expand beyond smartphones, leveraging its scale and capabilities to enter high-potential segments such as display modules and IT hardware (laptops, tablets, etc.).
On the consumer side, sustained demand for cooling products amid a hot summer outlook is expected to drive over 25% growth in room AC revenues for FY25.
Industry players are optimistic about achieving 20%+ RAC revenue CAGR over the next three–five years, creating a favorable backdrop for companies like PG Electroplast and Amber Enterprises. Meanwhile, Elin is also set to benefit from positive structural shifts — with the end of its exclusivity with Signify in LED products and a revival in demand for small domestic appliances; we see potential for margin improvement and valuation re-rating.
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