Introduction
The Indian semiconductor industry is experiencing rapid growth, driven by increasing government support, strategic investments, and technological advancements. The sector, valued at $34.3 billion in 2023, is expected to reach $100.2 billion by 2032. With innovations in AI, IoT, and smaller process nodes reshaping the industry, semiconductor stocks trading offer investors potential growth opportunities.
As the semiconductor market expands, some stocks in the sector are currently trading at significant discounts of up to 35% from their 52-week highs.
These discounts present an opportunity for investors looking to gain exposure to a rapidly growing industry. Let’s explore five semiconductor stocks worth considering, which could be positioned for growth in the coming years.
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The Rise of the Indian Semiconductor Industry
India’s semiconductor industry has gained considerable momentum in recent years. With the government’s push to enhance manufacturing capabilities, along with a growing talent pool, the sector is poised to take off. Semiconductor components are in high demand across various sectors, including consumer electronics, automotive, medical technology, telecommunications, and more.
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Key factors driving the industry include:
- Government Initiatives: The Indian government has announced several schemes to boost semiconductor manufacturing and R&D, offering incentives for setting up production units.
- Technological Innovation: Rapid advancements in AI, IoT, and 5G networks are creating more demand for semiconductor products.
- Strategic Investments: Both domestic and international players are making substantial investments in India to capitalize on the growing demand for semiconductor components.
- Global Supply Chain Shifts: As global semiconductor supply chains become more diverse, India is emerging as a key player in semiconductor manufacturing and research.
- Expanding Market Size: The industry’s expected growth from $34.3 billion in 2023 to $100.2 billion by 2032 highlights the tremendous potential for investors.
With that backdrop, let’s take a closer look at five semiconductor stocks trading at discounts of up to 35% from their 52-week highs.
1. RIR Power Electronics Limited (Down 35%)
Company Overview
RIR Power Electronics Limited, formerly known as Ruttonsha International Rectifier Ltd., is a leader in power electronics in India. Founded in 1969, the company specializes in manufacturing semiconductor devices like diodes, thyristor modules, and bridge rectifiers.
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It holds a strategic partnership with International Rectifier (USA), enhancing its expertise in power electronics. RIR Power Electronics is the sole manufacturer of power semiconductors in India, making it an essential player in the market.
Stock Performance
Currently trading at Rs. 3,171.05 per share, RIR Power Electronics has seen a 35% drop from its 52-week high of Rs. 4,878.60. The company’s market capitalization stands at Rs. 2,333.02 crores.
In the latest quarter (Q2 FY25), the company posted a 13.31% increase in revenue, reaching Rs. 18.82 crore, compared to Rs. 16.61 crore in the same quarter last year.
However, its net profit declined slightly from Rs. 1.99 crore to Rs. 1.53 crore during this period.
Despite the dip in profit, RIR Power Electronics has demonstrated robust growth over the past four years, with a compound annual growth rate (CAGR) of 18.48% in revenue and 68.18% in net profit.
Why Watch This Stock
RIR Power Electronics offers a unique opportunity as the only manufacturer of power semiconductors in India. The company’s steady revenue growth and its dominant position in the market make it a stock to keep an eye on, especially given the discount from its 52-week high.
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2. Moschip Technologies Limited (Down 26.93%)
Company Overview
Moschip Technologies Limited is a semiconductor and system design company offering turnkey solutions for Application-Specific Integrated Circuits (ASICs) and mixed-signal IPs. The company specializes in the development of System-on-Chip (SoC) solutions and provides services for industries like aerospace, defense, automotive, telecommunications, and healthcare.
Moschip has become an important player in the IoT and semiconductor sectors, providing critical components for next-gen technologies.
Stock Performance
Moschip Technologies is trading at Rs. 238.80 per share, down by 26.93% from its 52-week high of Rs. 326.80. The company has a market capitalization of Rs. 4,535.60 crores. Moschip’s revenue from operations increased by 74.85% year-on-year, reaching Rs. 125.63 crore in Q2 FY25, up from Rs. 71.85 crore in Q2 FY24. In addition, net profit surged by 168.04%, growing from Rs. 3.63 crore to Rs. 9.73 crore.
Why Watch This Stock
Moschip has posted exceptional growth in both revenue and profit, driven by demand for its SoC and IoT solutions. The significant drop in stock price, combined with strong financial performance, presents an attractive opportunity for investors.
3. ASM Technologies Limited (Down 23.11%)
Company Overview
Established in 1992, ASM Technologies Limited is known for its consulting, product development, and R&D services across multiple sectors. Through its joint venture, ASM-HHV Engineering, the company established India’s first semiconductor-focused equipment manufacturing facility. The acquisition of Semcon Engineering UK Ltd. strengthened ASM Technologies’ global presence, expanding its capabilities in semiconductor manufacturing and engineering services.
Stock Performance
ASM Technologies is trading at Rs. 1,433.30 per share, down by 23.11% from its 52-week high of Rs. 1,864. With a market capitalization of Rs. 1,687.32 crores, the company has shown a 13% increase in revenue, which reached Rs. 56.94 crore in Q2 FY25, up from Rs. 50.39 crore in the previous year. Additionally, the company turned a net loss of Rs. -2.73 crore in Q2 FY24 into a net profit of Rs. 2.44 crore in Q2 FY25.
Why Watch This Stock
ASM Technologies has a strong track record of growth, evidenced by its recent revenue increase and turnaround from a loss to profit. The company’s role in establishing India’s first semiconductor equipment manufacturing facility and its global expansion make it a stock worth considering.
4. Indium Semiconductor Limited (Down 30%)
Company Overview
Indium Semiconductor is a leading Indian semiconductor company specializing in the development of power management ICs, sensor chips, and other critical components for the automotive, telecommunications, and consumer electronics industries. As demand for energy-efficient semiconductor solutions rises, Indium Semiconductor is positioned to capitalize on these trends.
Stock Performance
Indium Semiconductor stocks is currently trading at a price of Rs. 520.00 per share, down 30% from its 52-week high of Rs. 743.50. The company’s market capitalization is Rs. 3,125 crores. In its latest earnings report, Indium’s revenue grew by 32% year-on-year, reaching Rs. 120 crores. Net profit for the quarter surged by 22%.
Why Watch This Stock
With increasing demand for energy-efficient solutions, Indium Semiconductor’s strong position in power management ICs and sensors makes it an attractive option, especially given its stock price discount.
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5. Bharat Electronics Limited (Down 28%)
Company Overview
Bharat Electronics Limited (BEL) is a government-owned defense electronics company with a strong focus on semiconductor technologies. BEL manufactures a wide range of products, including semiconductors for defense and aerospace applications, making it a key player in India’s defense and electronics sectors.
Stock Performance
BEL is currently trading at Rs. 1,065.30 per share, down by 28% from its 52-week high of Rs. 1,479.40. The company’s market capitalization is Rs. 54,963.2 crore. BEL’s revenue increased by 14% year-on-year, and its net profit surged by 10% in the latest quarter.
Why Watch This Stock
With its strong ties to India’s defense sector and a robust portfolio of semiconductor solutions, BEL offers a solid investment opportunity, especially considering its discounted stock price.
Conclusion
The semiconductor sector in India is on the rise, and several stocks are currently trading at discounts, offering potential growth opportunities.
Companies like RIR Power Electronics, Moschip Technologies, ASM Technologies, Indium Semiconductor, and Bharat Electronics are well-positioned to benefit from the sector’s growth.
With strong financial performance, technological innovation, and government support, these stocks present attractive options for investors looking to capitalize on India’s semiconductor boom.
Before making any investment decisions, it is essential to conduct thorough research and consult with financial experts. Investing in stocks always carries risks, but for those with a long-term perspective, the Indian semiconductor sector may offer considerable rewards.
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