Best Semiconductor Stocks in India for 2026

India's semiconductor ambitions are entering a new phase.

The government's ISM 2.0 programme, backed by billions of rupees in incentives, is aimed at building domestic capacity in chip design, packaging and fabrication.

Global demand for semiconductors is surging on the back of AI, EVs and 5G, while supply chains are diversifying away from traditional hubs.

This combination of local policy support and global tailwinds has put Indian semiconductor stocks on the radar of every investor.

Under Semicon 2.0, India is targeting 5% of global semiconductor production by 2030.

Back in 2021, the government had announced a US$ 10 billion (bn) incentive package to build the ecosystem from the ground up. Five projects spanning chip fabrication, OSAT and ATMP have already been approved.

This policy shift could open opportunities for investors looking at India's semiconductor value chain.

What Are Semiconductor Stocks?

Semiconductor stocks are companies engaged in designing, building, packaging and testing chips, along with those supplying critical inputs and services.

Some are fabless design specialists who create chip architecture, while others invest in large capital-intensive fabs or advanced packaging units.

There are also adjacent players offering engineering services, chemicals, or software that support the semiconductor ecosystem.

List of Best Semiconductor Stocks in India

Here is a list of the best defence stocks in India for 2025, selected based on market capitalisation and a debt-to-equity ratio below 1, using Equitymaster's "Best Semiconductor Stocks" and "Best Smallcap Semiconductor stocks" stock screener.

Note: All the information regarding shares is recorded as of 25 September 2025.

#1 MosChip Technologies

MosChip Technologies is a semiconductor and system design services company with over two decades of expertise. Its core spans ASICs, SoCs, VLSI design and embedded software.

The company has been a beneficiary of India's design-linked incentive scheme. It has secured a Rs 50 bn contract from C-DAC to design a high-performance computing SoC on 5 nm.

Revenue has grown at a 40% CAGR over 3 years, though profitability remains under pressure due to high R&D and employee costs.

MosChip is building a pipeline in RISC-V architecture, AI, and HPC processor development. The management is focussed on turning EBITDA positive in FY26 as design wins in automotive and aerospace semiconductors convert into revenues.

Its fabless model ensures scalability and capital efficiency. Investments will be funded through internal accruals, with an eye on expanding abroad.

#2 SPEL Semiconductor

SPEL Semiconductor is among India's earliest semiconductor assembly and test (OSAT) companies, with decades of experience in chip packaging. Its focus areas include assembly, testing, and packaging services for integrated circuits.

The company has faced financial volatility, with FY25 results showing pressure on profitability and muted revenue growth. High competition, cyclicality in demand and reliance on a limited set of clients have weighed on margins.

However, SPEL is investing in packaging technologies to stay ahead in the OSAT space. The management is focused on improving capacity utilisation as well as global partnerships. Funding for growth will primarily rely on internal accruals to improve efficiency and reduce costs.

#3 Bharat Electronics

The company was among the early entrants into semiconductor manufacturing in India, producing germanium and silicon transistors in the 1960s.

However, due to factors such as global competition and technological advancements, BEL phased out its semiconductor fabrication operations.

Although it phased out its manufacturing operations, BEL is now involved in developing indigenous semiconductor solutions through its MoU with Tata Electronics.

In June 2025 Tata Electronics has signed a memorandum of understanding (MoU) with Bharat Electronics Limited to jointly develop electronics and semiconductor solutions.

This includes Semiconductor Fabrication (Fab), Outsourced Semiconductor Assembly and Test (OSAT), and chip design services offered by Tata Electronics, aligned with BEL's current and future product needs.

#4 Kaynes Technology

Kaynes Technology has evolved from an electronics manufacturing services company into an integrated ESDM (Electronic System Design and Manufacturing) player. Its portfolio spans design, process engineering, box-build manufacturing and lifecycle support across automotive, aerospace, industrial, railways, and medical segments.

What sets it apart is its strategic move into the semiconductor value chain with two critical projects: an OSAT facility at Sanand, expected to be operational by December 2025, and a multilayer HDI PCB plant in Chennai, slated to start in early 2026. These facilities position Kaynes as one of the first Indian firms with capabilities across design, manufacturing, and advanced packaging.

In FY25, revenue rose 51% to Rs 27,218 mn, while EBITDA grew 62% to Rs 4,107 mn with margins at 15.1%. PAT was up 60% year on year, with an order book of Rs 65,969 mn providing strong visibility.

Looking ahead, Kaynes plans to leverage its global footprint, including the acquisition of Canada's August Electronics, to serve high-margin EMS and semiconductor clients.

#5 ASM Technologies

ASM Technologies is a design-led manufacturing specialist, offering end-to-end product development across concept, design, prototyping and production.

It has carved a niche in the ESDM ecosystem by building capabilities for semiconductor design and electronics manufacturing.

The company reported FY25 revenue of Rs 2.9 bn, up from Rs 2 bn in FY24, with profits of Rs 251 m compared to a loss earlier. Good execution and operating leverage drove the turnaround.

ASM has committed Rs 5.1 bn towards new facilities in Karnataka, targeting expansion in semiconductor and high-tech equipment manufacturing. The capex is expected to be funded by internal accruals and partnerships.

The company is positioning itself as a design-led partner to global clients.

#6 Tata Electronics (Unlisted)

Tata Electronics is emerging as a key player in India's semiconductor and electronics industry. This unlisted firm is building capabilities across EMS, OSAT, foundry, and design services.

The company is spearheading India's first commercial semiconductor fabrication facility in Dholera with a Rs 910 bn project capable of 50,000 wafer starts a month. It's also scaling AI-enabled foundry operations and advanced packaging.

Tata Electronics is focused on ramping up assembly and testing, while building design services for customised chips. Over the long term, it plans to expand abroad. It has operations in 17 countries with a workforce of over 65,000.

Funding for the capex will come from group resources and partnerships with leading global firms, positioning Tata Electronics as a cornerstone of India's semiconductor mission.

#7 CG power

CG Power, also known as Crompton Greaves Power, specialising in electrical equipment and engineering solutions is making a significant foray into the semiconductor industry.

The company announced in August 2025 that its subsidiary, CG Semi Private Limited, has launched its first outsourced semiconductor assembly and test (OSAT) facility in Sanand, Gujarat.

With this launch, CG Semi Private becomes one of India's first full-service OSAT providers, offering solutions across both traditional and advanced packaging technologies. The company noted that this milestone strengthens India's semiconductor ecosystem, advancing the country's self-reliance goals while also catering to global markets.

The project, developed with support from the central and state governments, is in collaboration with Renesas and Stars Microelectronics. CG Semi Private plans to invest over Rs 76 bn (around US$ 870 million) over the next five years to establish two state-of-the-art facilities, G1 and G2, in Sanand, Gujarat.

#8 HCL Technologies

HCL Technologies is a top-tier IT firm making inroads into the semiconductor ecosystem through ER&D, AI and next-gen software engineering.

Its engineering and R&D segment grew 5.5% in FY25, with bookings up 75%. The company works with chipmakers, auto OEMs and telecom firms on design, silicon validation, and AI model testing. FY25 revenue was US$ 13.84 bn, up 4.7% in constant currency, with EBIT margins at 18.3%.

HCL is embedding GenAI across platforms, supported by partnerships with NVIDIA and Google. Its AI Labs and software business are expected to expand silicon use cases.

The company's capex will focus on scaling AI-enabled solutions, funded by internal accruals. The company is positioning itself as a critical enabler in the global semiconductor supply chain.

#9 Tata Elxsi

Tata Elxsi does not make chips but it has become a key enabler in the semiconductor ecosystem.

Its edge lies in embedded software, chip and system integration, and design services for industries where electronics rule such as automotive, telecom, media, and healthcare.

The company's platforms say it all: AVENIR for software-defined vehicles, AutonomAI for self-driving and MOBIUS+ for battery lifecycle traceability. Partnerships with Qualcomm, Nidec, and Emerson show how Tata Elxsi has built deep linkages with the global semiconductor ecosystem.

In FY25, revenues crossed Rs 37 bn, margins stayed north of 25% and the balance sheet remains debt free. Growth is being funded entirely through internal accruals, with automotive electronics and digital engineering driving momentum.

Tata Elxsi is a 'picks and shovels' candidate in India's semiconductor ecosystem. It's not a chipmaker but a design driven integrator.

#10 Dixon Technologies

Dixon Technologies is one of India's largest electronics manufacturing services (EMS) companies.

The company assembles products for global and domestic brands across consumer electronics, lighting, appliances, and mobile devices.

In FY25, Dixon's revenue crossed Rs 200 bn, driven by strong growth in mobile phone assembly and home appliances.

The company has consistently expanded capacity, scaling its EMS offerings while maintaining an asset-light model through client partnerships. Profitability, though modest (3-4% margins), has held steady due to operating leverage.

Dixon is diversifying into semiconductors and electronic components with plans for chip assembly and sub-systems. It's a beneficiary of the government's PLI scheme. Capex is being funded through a mix of accruals and strategic partnerships.

#11 MIC Electronics

MIC Electronics has built its business around LED displays, digital signage, and electronic information systems, with Indian Railways as a key client.

Recently, the company has shown intent to diversify into the semiconductor ecosystem through acquisitions and partnerships.

In FY25, MIC reported revenue of around Rs 11 bn, with profitability under pressure due to rising input costs.

Its bread-and-butter LED display business remains intact but it's pivoting to electronics and chip-linked solutions. A proposed acquisition of a Singapore-based semiconductor firm marks its entry into a higher value chain segment.

MIC's challenge will be to integrate its semiconductor ambitions with its stable but low-growth display business.

Capex requirements are significant and execution timelines are uncertain. Funding is expected through a mix of accruals and strategic tie-ups. If successful, MIC could evolve from a niche display player into a semiconductor-linked company.

Pros of Investing in Semiconductor Stocks

The biggest advantage is long-term demand.

Chips are at the core of every major technology trend, from AI and cloud computing to EVs, and telecom. India's low cost engineering talent gives it an edge when attracting global partnerships.

Government incentives have reduced entry barriers and encouraged R&D.

For investors, these tailwinds mean that well-positioned companies could see multi-year growth, creating opportunities for both smallcap innovators and larger established firms.

Cons of Investing in Semiconductor Stocks

The risks are significant.

Semiconductor projects require huge capital investment and long gestation before profits flow in.

Even design firms must spend heavily on R&D and talent which can keep margins under pressure.

The industry is cyclical, with demand fluctuating as global technology spending shifts. Rapid innovation also means companies can fall behind if they fail to keep up.

Valuations are another concern, as many stocks already trade at high multiples, leaving little room for any slipups.

Should You Invest in Semiconductor Stocks?

For investors, top semiconductor stocks represent a high-opportunity but high-risk opportunity. They can add growth potential to a portfolio, but allocations should, ideally, be measured.

Stability lies with larger technology and engineering firms that already generate strong cash flows.

The fast growth comes from smaller, more focused companies that are scaling up in design, packaging, or materials.

Thus, a balanced approach combining stable exposure with selective picks in emerging names is more prudent than going all-in on early-stage firms.

Conclusion

India's semiconductor sector is still in its early innings. But the foundations are being laid for long-term growth.

Policy support, global demand, and domestic capabilities are aligned, creating fertile ground for expansion. At the same time, the risks of capital intensity, technology shifts, and execution delays cannot be ignored.

For investors willing to take a patient, selective approach, semiconductor stocks can be rewarding. The key to success in this sector will be to focus on businesses with clear strategies, strong balance sheets, and the ability to scale sustainably.

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...