Indian electronic contract manufacturers are expanding globally through acquisitions and strategic partnerships to gain access to clients in the US, Europe, and other international markets. They are capitalising on supply chain disruptions triggered by tariff-related shifts, particularly those involving China. These companies are leveraging the current trade environment to acquire technologies and capabilities that would otherwise take years to develop internally. Their strategy aligns with the Indian government’s push to strengthen domestic electronics manufacturing and increase exports. “Given the small window of opportunity, companies are taking the shortcut route of acquisitions to tap into clients looking to establish alternative supply chains beyond China. The idea is that you can sell not only what the target entity is selling, but also your own expertise and products,” a senior executive from a contract manufacturing firm told ET. Firms including Kaynes, Dixon Technologies, Syrma SGS, Cyient, and Amber Group are actively pursuing overseas deals to enhance their technological strength and global market presence. Amber Group, which specialises in consumer durables and electronics, is investing over Rs 400 crore to acquire a controlling stake in Israel-based Unitronics, an industrial automation company. At the same time, Calcom Vision is setting up an export-focused division. “Amber’s acquisition is driven by the need to cater to aerospace and defence globally, which requires specific certifications. Acquiring a company that already possesses these certifications is crucial for Indian players tapping into global markets, as obtaining them independently is challenging and time-consuming,” said an industry analyst, requesting anonymity. The deal gives Amber Group access to defence-sector clients in the US and Europe- both regions seeing increased defence spending amid ongoing conflicts in Ukraine and Gaza. Dixon Technologies, meanwhile, has formed joint ventures with several Chinese component manufacturers to gain access to technology, with total investments exceeding Rs 1,000 crore in equity and capacity expansion. Kaynes and Syrma SGS have partnered with Korean firms to enter the printed circuit board (PCB) segment. Both have also acquired stakes in companies in the US, Austria, and Germany to tap into their existing customer networks.Syrma SGS reported Rs 232 crore in industrial component exports during the June quarter, marking a 29 percent sequential rise. “Exports, we are primarily doing to Western Europe and the USA. The tariff uncertainty is definitely holding back customers from receiving large orders. Hopefully, within this quarter, this uncertainty will be a thing of the past,” Syrma SGS managing director Jasbir Gujral said during a recent earnings call. Calcom, which manufactures LED lighting and ceiling fans, is relaunching its export division in response to rising demand for diversified supply chains, according to executive director Abhishek Malik. “The tariff wars are the trigger for us to re-enter the export business after the pandemic. Two US companies have already audited us and our products are currently undergoing testing. We expect to hear from them by the end of the month,” Malik said, as quoted by ET. India currently faces tariffs of 10–15 percent on lighting exports to the US under deferred reciprocal duties, while Washington’s stance on tariffs on Chinese goods remains uncertain. Should the balance tilt in India’s favour, Malik anticipates significant interest from US brands, especially in lighting and fan categories. However, analysts warn that the ongoing wave of acquisitions could raise concerns among investors about capital allocation and delayed returns. “Investors could be worried that money is constantly being reinvested into the market in the form of new investments and acquisitions, but they are not seeing peak asset turns. Returns are being deferred, meaning investors have to wait longer to realise their profits,” an analyst said, as quoted by ET.
