This EMS company's stock has surged over 30% in just 1 month following a brokerage upgrade and MF raising stake
One of the key triggers has been a stake hike by Franklin Templeton Mutual Fund, which raised its holding in Syrma SGS across various schemes to 5.069% of the total paid-up equity share capital, crossing the critical 5% regulatory disclosure threshold. The fund house acquired 1,67,780 equity shares through open market transactions, increasing its holding from 4.975% earlier.
Meanwhile, JP Morgan initiated coverage on Syrma SGS Technology on July 9 with an 'Overweight' rating, citing the company as a high-conviction play in India's rapidly growing EMS space. The brokerage has projected a 31% compound annual growth rate (CAGR) in sales between FY25 and FY28, backed by strong demand in industrial and automotive segments and improving profitability metrics.
According to JP Morgan, Syrma's EBITDA margins are expected to expand by 70 basis points to 9% by FY28. This is seen as a result of easing margin pressures in the consumer electronics vertical, robust order inflows from key end-user industries, and operating leverage benefits.
The brokerage also pointed to a likely recovery in exports from FY27, a factor it believes is underappreciated by the market and may lead to potential earnings upgrades in the coming years.
JP Morgan, in a broader note on the sector, dubbed India's EMS industry a 'sunrise sector', predicting a 32% revenue CAGR over FY25–30, driven by the 'Make in India' policy push, rising electronic content across devices, and the global China+1 supply chain diversification strategy.
The recent upmove in Syrma SGS's stock reflects a broader re-rating of high-growth domestic manufacturing plays. With both mutual fund interest and foreign brokerage support, the stock has outperformed the broader market and remains in focus as investors look for structural growth stories in India's electronics and tech manufacturing ecosystem.
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