3 Top Semiconductor Stocks in India to Keep on Your Watchlist

The semiconductor industry lies at the heart of the modern digital economy, powering everything from smartphones and laptops to electric vehicles, data centres, and cutting-edge artificial intelligence applications.

As global demand for high-performance computing and advanced electronics continues to accelerate, semiconductor companies are playing an increasingly vital role in shaping technological innovation and economic growth.

Over the past few years, the sector has witnessed a remarkable transformation driven by breakthroughs in chip design, increased automation, and government-backed initiatives to secure domestic chip production.

However, this rapid evolution has also brought about intense competition, cyclical volatility, and supply chain challenges, making it essential for investors to identify companies with strong fundamentals, strategic advantages, and long-term growth potential.

As supply chains across the world start becoming more inward looking with governments pushing for local sourcing amidst trade wars, the need to have manufacturing capabilities for such critical components within the country becomes all the more important.

Government initiatives such as Make in India, PLI (Production Linked Incentive) schemes, and Startup India have created a supportive ecosystem for semiconductor manufacturing in India.

For those looking to capitalise on the semiconductor boom, carefully curating a watchlist of top-performing and resilient stocks is a prudent first step.

In this article, we highlight three leading semiconductor stocks that stand out for their market leadership, innovative edge, and promising financial outlooks.

Read on...

#1 HCL Tech

HCL Tech is a leading global IT services company, which is ranked amongst the top five Indian IT services companies in terms of revenues.

The company offers an integrated portfolio of services including software-led IT solutions, remote infrastructure management, engineering and R&D services and BPO.

HCL Tech derives its revenues from 3 main business verticals namely:

• IT & Business Services: Services such as application, infrastructure and digital process operations and digital transformation services enabled by digital and analytics, cloud-native, cybersecurity solutions.
• Engineering and R&D Services: Offers engineering services and solutions across software, embedded, mechanical, VLSI, and platform engineering, supporting the end-to-end lifecycle of both hardware and software products across diverse industries.
• HCL Software: It offers modernized software products and IP-led offerings for business apps and industrial software, data, and analytics, intelligent operations, security, and compliance.

Geographically, the company derives 65% revenues from America, 28% from Europe, and the balance 7% from the rest of the world.

It derives 21% of its revenues from financial services segment, 20% from manufacturing, 16% from life sciences & healthcare, 13% from technology and services, and the balance 30% from others.

The company serves over 60 countries and 159 nationalities, through its network of over 200 delivery centres and 150 innovation labs globally.

HCL Tech is actively involved in the semiconductor industry, offering a range of services and solutions for chip design, manufacturing, and testing.

It has partnerships with leading semiconductor companies and is focused on leveraging technologies like AI, IoT, and cloud computing to drive innovation and efficiency in the industry.

In May 2025, India's cabinet has approved a new semiconductor plant, a joint venture between HCL Group and Taiwan's Foxconn, costing Rs 37 bn (US$ 435 million).

The plant, which will be located near the Jewar airport in the northern state of Uttar Pradesh, is designed for a capacity of 20,000 wafers per month and can produce 36 million display driver chips.

Going ahead, the management has given a guidance of revenue growth range of 2-5% in constant currency terms with an EBIT margin guidance of 18-19%.

#2 Bharat Electronics

Incorporated in 1954, Bharat Electronics Ltd (BEL) manufactures and supplies electronic equipment and systems to the defence sector. The company also has a limited presence in the civilian market.

The company develops advanced electronic equipment, systems, and services for the Indian defence sector, including radar and fire control systems, weapon systems, communication, network centric systems (C4I), electronic warfare systems, etc.

BEL also diversified its business by developing innovative products in sectors such as homeland security, smart city solutions, space electronics, cyber security, software solutions, medical electronics, and systems alternate energy solutions, etc.

The company derives 96% of its revenues from India and the balance 4% from exporting to countries such as France, the US, Spain, Israel, China, Germany, ASEAN, Armenia, Sri Lanka, and others.

BEL has 9 manufacturing units across India. The Bangalore and the Ghaziabad units are the two major units.

The company has entered MoU's with Airports Authority of India, Delhi Metro, IISC, and UAS, opening opportunities for more civilian orders.

Tata Electronics and Bharat Electronics Limited (BEL) on 5 June 2025, signed a Memorandum of Understanding (MoU) to jointly explore semiconductor and advanced electronics solutions aligned with India's push for self-reliance in the sector.

The collaboration will focus on identifying and developing end-to-end solutions spanning semiconductor fabrication (Fab), Outsourced Semiconductor Assembly and Test (OSAT), and chip design services.

The two companies also plan to co-develop optimal manufacturing practices through knowledge sharing and joint capability development, supporting India's broader vision to reduce import dependency in critical electronics and semiconductor domains.

The management has reiterated confidence in achieving revenue growth of over 15%, with EBITDA margins between 23-25%.

#3 ABB India

ABB India Limited is an integrated power equipment manufacturer supplying the complete range of engineering, products, solutions and services in areas of automation and power technology.

The company is a subsidiary of ABB Ltd, a global leader in electrification and automation with operations in 100+ countries.

It gains advantages from its parent company, including access to ABB's centralized R&D facilities, for which it pays royalties.

The company operates in 4 different business segments namely electrification (43% revenues), motion (34% revenues), process automation (18% revenues), and robotics (5% revenues).

Geographically the company derives 90% of its revenues from the domestic markets and the balance 10% from international sales.

ABB India has a network of 28 sales offices and 750+ partners. It exports its products to 30+ countries.

The company operates 25 manufacturing plants across 5 locations in India. In March 2025, the company partnered with AI startup UptimeAI to enhance asset health and performance management in heavy industries.

It's critical enabler in the semiconductor ecosystem, providing essential power, automation, and electrification solutions to keep chip manufacturing facilities running efficiently. Although the company does not manufacture semiconductors, it supports the industry in many ways.

Going ahead, the management has acknowledged a volatile and sluggish macro environment, especially in large project/process automation orders, due to global/domestic uncertainty.

Conclusion

The semiconductor industry stands as a critical pillar of modern technological advancement, underpinning innovations across industries from consumer electronics to AI, defence, and industrial automation.

With increasing global digitalisation, heightened geopolitical tensions, and growing demand for self-reliant supply chains, the spotlight on domestic semiconductor capabilities has never been stronger.

Against this backdrop, India's push through initiatives like PLI schemes, Make in India, and strategic joint ventures is reshaping the country's semiconductor landscape.

The three companies profiled in this article HCL Tech, Bharat Electronics Ltd (BEL), and ABB India Ltd offer unique and complementary exposures to different facets of the semiconductor and advanced electronics value chain.

The three companies profiled in this article HCL Tech, Bharat Electronics Ltd (BEL), and ABB India Ltd offer unique and complementary exposures to different facets of the semiconductor and advanced electronics value chain.

Each company is well-aligned with India's broader vision of becoming a global hub for electronics and semiconductor manufacturing.

Despite cyclical market challenges and operational headwinds, these firms exhibit strong fundamentals, government backing, and a long-term strategic direction that could deliver sustainable value.

As the semiconductor sector evolves, maintaining a diversified and carefully curated watchlist of such players can offer investors exposure to high-growth opportunities while balancing risks through industry-wide diversification.

With the right research and a balanced approach, they may offer unique growth opportunities and substantial potential.

As always, investing decisions should be guided by individual risk tolerance, financial goals, and proper due diligence.

Remember the challenges before diving headfirst.

Happy investing.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...