Dixon, Amber, Kaynes Rally: What Changed?

Electronics Manufacturing Stocks: Shares of electronics manufacturing companies gained up to 5% on Thursday, 9 July, after the government expanded customs duty concessions on machinery and components used in electronics manufacturing.

The relief covers equipment and components used in lithium-ion cell manufacturing, display assemblies and wireless charging inductor coil modules. The exemptions have come into effect immediately and will remain available until 31 March 2029.

Following the announcement, Dixon Technologies, Amber Enterprises, Kaynes Technology and Syrma SGS Technologies gained in Thursday’s trade.

Dixon Technologies shares rose 4.7% to ₹13,544, while Amber Enterprises gained 2.5% to ₹7,607.50. Kaynes Technology advanced 3.7% to ₹3,328.90, as of 10.40 AM

Syrma SGS shares were also among the top gainers. The stock was trading 3.2% higher at ₹1,410.40 in early trade.

Customs Duty Relief for Lithium-Ion Cell Manufacturing

The Central Board of Indirect Taxes and Customs (CBIC) has expanded the list of machinery eligible for customs duty concessions for lithium-ion cell manufacturing.

The revised list covers 85 types of equipment used across different stages of the manufacturing process. These include machinery for material mixing, coating, pressing, slitting, winding, stacking, electrolyte filling, welding, testing, ageing, inspection and packaging.

The concessions also cover supporting systems used for solvent recovery, heat recovery, dust collection and effluent treatment.

The wider coverage could help companies investing in domestic lithium-ion cell manufacturing by reducing the cost of importing specialised production equipment.

Relief Extended to Display Assembly Components

The government has also provided customs duty concessions on 5 components used to manufacture display assemblies for automotive, medical and industrial applications.

These components include display cells, flexible printed circuit assemblies (FPCAs), backlight units, frames and anisotropic conductive film (ACF).

However, the exemption does not apply to display assemblies used in mobile phones, smartwatches, televisions, smart meters and interactive flat-panel displays.

Companies working in automotive, medical and industrial electronics could benefit from lower component costs under the revised duty structure.

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Wireless Charging Components Also Covered

Customs duty relief has also been provided on 6 components used to manufacture wireless charging inductor coil modules for mobile phones.

The covered components include nano-crystalline assemblies, E-shields, PET liners, PC shims, coils and neodymium magnets.

This could support companies involved in manufacturing magnetic products, electronic components and mobile phone sub-assemblies in India.

What Does Duty Relief Mean for Dixon Technologies?

Dixon Technologies is one of India’s largest electronics contract manufacturers, with a presence across smartphones, IT hardware, televisions and other consumer electronics products.

Lower costs for imported machinery and eligible components could support the company’s manufacturing economics and expansion plans. The benefits could also help its growing mobile and electronics businesses as domestic electronics manufacturing continues to expand.

Another reason behind the rally is the Centre’s approval for Dixon Technologies’ joint venture with Vivo Mobile India. The JV will manufacture smartphones, with Dixon holding a 51% stake and Vivo owning the remaining 49%. The approval comes 19 months after the agreement was signed in December 2024.

Why Could Syrma SGS Benefit?

Syrma SGS has a presence in the manufacturing of magnetic products such as inductor coils, chokes and transformers.

The customs duty relief on components used in inductor coil modules could make domestic assembly more cost-competitive against direct imports, particularly from China.

How Could Kaynes Technology Benefit?

Kaynes Technology has exposure to automotive, aerospace and industrial electronics. Its business involves embedded systems, electronic sub-assemblies and display-related products.

Lower costs for eligible imported components could support the company’s margins and manufacturing operations, particularly in segments where specialised components still need to be imported.

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Why Does the Government Move Matter?

India has been working to increase domestic production of electronics and reduce its dependence on imported finished products.

However, many specialised machines and components required for advanced electronics manufacturing are still imported. Customs duties on these imports can increase the initial cost of setting up manufacturing capacity as well as the cost of production.

By extending duty concessions until 31 March 2029 and widening the list of eligible machinery and components, the government is looking to support investments across lithium-ion cells, automotive electronics, industrial electronics and other advanced manufacturing areas.