Syrma SGS Technology Ltd has caught investor attention after global brokerage firm JP Morgan reiterated its bullish stance on the stock. The brokerage has assigned a Buy rating with a revised target price of ₹950 per share, implying a potential upside of 28% from its current market price of ₹744.

Strong Brokerage Call

JP Morgan upgraded Syrma’s target from ₹800 to ₹950, citing strong growth prospects and strategic capital deployment. The firm expects Syrma to maintain its position as one of the fastest-growing companies in the electronics manufacturing services (EMS) sector, projecting a 30% revenue CAGR between FY25 and FY28.

The brokerage also highlighted that Syrma is gearing up for a Qualified Institutional Placement (QIP) to fund mergers and acquisitions (M&A). While the mobile segment may not be a priority due to lower margins, Syrma’s past acquisitions have proven margin-accretive, boosting profitability.

Company Overview

With a market capitalization of ₹14,286 crore, Syrma SGS Technology is a leading EMS provider with a global footprint across India, the US, Germany, and other key markets. The company offers end-to-end solutions, including:

  • Product design and development

  • Prototyping and system integration

  • Original design manufacturing

  • PCB assemblies (PCBAs)

  • Electromechanical assemblies

  • RFID products and custom magnetics

Syrma serves a wide range of industries such as automotive, healthcare, consumer electronics, industrials, railways, and IT.

In November 2023, the company launched Syrma Semicon Private Limited (SSPL), focusing on semiconductor product design, manufacturing, and distribution, including memory chips and PCB assemblies. The firm is also exploring opportunities in the OSAT (Outsourced Semiconductor Assembly and Testing) market.

Financial Performance

For Q1 FY26, Syrma reported:

  • Revenue: ₹944 crore, down 19% YoY but up 2% QoQ

  • Net Profit: ₹50 crore, up 150% YoY but down 30% QoQ

  • ROE: 10.19% | ROCE: 12.41%

  • Valuation: Currently trades at a high P/E of 71x, compared to the industry average of 37.17x

Despite short-term revenue pressure, the company’s profitability growth and long-term sectoral opportunity remain robust.

Analyst View

JP Morgan believes Syrma SGS is well-positioned for sustained growth, supported by its diversified product portfolio, strong industry demand, and expansion in semiconductors. Investors with a long-term horizon may find the stock attractive despite its high valuations.