3 Undervalued Semiconductor Stocks to Add to Your Watchlist

When discussing Asia's semiconductor landscape, the spotlight typically falls on Taiwan's cutting-edge foundries, South Korea's memory chip powerhouses, Japan's comprehensive capabilities, and China's growing ambitions. India, meanwhile, is often overlooked.

But that may soon change. Backed by a massive talent pool, strong engineering expertise, and multi-billion-dollar government incentives, India is steadily shaping a dynamic semiconductor ecosystem.

As a result, semiconductors have emerged as a major investment theme on Dalal Street. While many stocks in this space already command premium valuations, there are still a few pockets of value.

For investors looking to capitalise on this opportunity, this editorial highlights three undervalued stocks in India that, while not pure-play semiconductor companies, form an important part of the broader semiconductor ecosystem.

#1 Mindteck

First on the list is Mindteck.

Mindteck is a leading provider of software and hardware solutions for the semiconductor industry.

With over two decades of experience, the company has supported semiconductor capital equipment manufacturers, subsystem vendors, and fabs by enhancing equipment software features, improving performance, and boosting overall productivity.

Its semiconductor engineering and equipment lifecycle services span the entire value chain - new product development, sustenance testing, support, and performance improvement.

Here's a snapshot of Mindteck's core capabilities across semiconductor software and automation...

Mindteck's strengths include deep domain knowledge across both front-end and back-end equipment, strong expertise in software subsystems, and a suite of solution accelerators.

The company's semiconductor software offerings include:

• Equipment software
• FAB/MES software
• Advanced process solutions and IT services

As of 11 December 2025, the stock trades at a PE of 20.2, compared with the industry PE of 26.1.

Source: Equitymaster

Over the past three years, its revenue has grown at a CAGR of about 12.4%, while profit has increased from Rs 208 m in FY23 to Rs 287 m in FY25.

Its three-year average ROE and ROCE stand at 11.5% and 14.7%, respectively.

Going forward, the company's focus on point-of-care devices, asset tracking, and real-time data solutions positions it well to benefit from rising demand in healthcare, logistics, and smart infrastructure.

For more details, see the Mindteck India company fact sheet and quarterly results.

#2 Wipro

Next on the list is Wipro.

Wipro holds a strong position in the semiconductor space, supported by extensive engineering expertise and domain knowledge.

Its engineeringNXT team has delivered over 150 tapeouts in the past five years, offering services such as advanced-node derivative SoC development, silicon validation, reference board design, software driver and firmware development, and analog mixed-signal solutions.

The company also operates a SerDes center of excellence with multiple successful designs, including the 28G/16FFC SerDes.

These capabilities enable clients to accelerate development and scale efficiently across semiconductor programs.

The stock, as of 11 December 2025, trades at a PE multiple of 19.9 against an industry PE of 26.1.

Source: Equitymaster

Over the past three years, its revenue has grown at a CAGR of about 4%, while profit grew at a CAGR of 2.6%.

Its three-year average ROE and ROCE stand at 15.3% and 20.1%, respectively.

For more details, see the Wipro company fact sheet and quarterly results.

#3 Vedanta

Last on the list is Vedanta.

Vedanta is involved in semiconductor through its wholly owned subsidiary, Vedanta Semiconductors Private Limited (VSPL).

VSPL plans to set up a 40nm CMOS-based semiconductor fab with a capacity of 40,000 wafers per month of 300 mm wafer size. In phase 2, after reaching the mass production of 40nm, the company will transition to the upgraded technology of manufacturing 28nm size chips.

These semiconductor chips will cater to applications in mobiles, consumer electronics, automotives and network equipment.

The stock, as of 11 December 2025, trades at a PE multiple of 11.6 against an industry PE of 46.9.

Source: Equitymaster

Over the past three years, its revenue has grown at a CAGR of about 4.8%, while profit has seen growth from Rs 145,060 m in FY23 to Rs 205,350 m in FY25.

Its three-year average ROE and ROCE stand at 37.2% and 36%, respectively.

Going forward, Vedanta has proposed a demerger. For aluminium, zinc, energy, and metals (including base metals and ferroalloys), there are plans to divide the company into separate entities to improve focus, draw in segment-specific investors, and raise valuations through specialised management.

Every Vedanta Ltd shareholder will receive one share in each of the newly demerged companies upon the completion of the process, in accordance with the demerger plan.

Aluminium, zinc, copper, iron ore, and other metals that Vedanta produces through its subsidiaries are used in power, infrastructure, construction, electric vehicles, and renewable energy equipment.

For more details, see the Vedanta company fact sheet and quarterly results.

Should You Consider Investing in Undervalued Semiconductor Stocks?

Investing in undervalued semiconductor stocks may look appealing for investors looking for early exposure to a sector that is gradually strengthening in India. But this should be approached with a balanced and long-term view, as the ecosystem is still developing.

Looking ahead, the India Electronics and Semiconductor Association (IESA) expects the country's semiconductor market to grow from Rs 4,501.6 bn (bn) (US$ 52 bn) in 2024 to Rs 8,951.3 bn (US$ 103.4 bn) by 2030.

This expansion will be driven by mobile handsets, IT, telecommunications, consumer electronics, automotive, aerospace, and defence.

Mobile handsets, IT, and industrial applications currently make up nearly 70% of the industry's revenue and are likely to remain the key demand contributors in the years ahead.

However, the sector is still at a nascent stage domestically, which means progress may be volatile compared to mature global semiconductor markets.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

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...