India is aiming to become a global semiconductor hub.
In the Union Budget 2026–27, the government announced India Semiconductor Mission 2.0 with a Rs 1,000 crore push to deepen domestic capability in chip manufacturing, design and materials. This is part of a larger effort to build a complete value chain in India, from fabrication to assembly and testing.
Industry estimates suggest India’s semiconductor market could reach $100–110 billion by 2030 as demand rises across sectors.
Chips are part of almost everything we use today. They go into phones, laptops, cars and network equipment. As digital use grows, demand for semiconductors also rises. If India builds more of this ecosystem at home, it can support local manufacturing and cut import dependence. The government has cleared large projects and is offering incentives to draw global and domestic players.
For investors, the opportunity may not be limited to companies that actually make chips. Businesses that supply materials, engineering services or infrastructure to electronics makers can also gain. When manufacturing activity rises, these linked companies often see steady demand as well. As India builds up its supply chain, these adjacent companies could see faster growth.
In this context, we have selected four stocks that are not direct chip makers. Instead, they are positioned to benefit from the expanding semiconductor and electronics ecosystem. Their products or services are used in materials, infrastructure, engineering and industrial segments that grow as semiconductor activity rises. This makes them hidden but relevant beneficiaries of the larger semiconductor cycle.
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#1 Navin Fluorine International: The Specialty Chemical Backbone of Chip Materials
Navin Fluorine International is primarily engaged in producing refrigeration gases, inorganic fluorides, specialty organofluorines and offers contract research and manufacturing services. Its portfolio includes 50+ fluorinated compounds developed over the years.
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Navin Fluorine posted a sharp rise in earnings for the December quarter. Revenue in Q3 FY26 stood at Rs 892 crore, up 47% from a year ago. Net profit rose 122% to Rs 185 crore. For the nine-month period, revenue increased 44% to Rs 2,376 crore and margins improved to 32%.
The specialty chemicals segment reported its highest-ever quarterly revenue at Rs 354 crore, a 60% rise year-on-year (YoY). Contract development and manufacturing organisations (CDMO) revenue grew 61% to Rs 127 crore. The company commissioned its cGMP-4 Phase-1 facility and began commercial supplies during the quarter. The AHF plant has also been commissioned.
Management said capex projects are progressing as planned. The Chemours project is expected to be completed in Q1 FY27. The company is also exploring opportunities in electronic chemicals linked to the semiconductor value chain. While input costs remain a factor, order visibility across segments remains steady.
Semiconductor fabrication requires high-purity specialty chemicals and fluorinated compounds at various stages of production. As chip manufacturing capacity expands, demand for advanced chemical inputs could rise. Companies like Navin Fluorine that have expertise in fluorochemicals may see incremental opportunities if domestic semiconductor projects scale up
In the past year, the share price of Navin Fluorine International rallied 51.9%.
Navin Fluorine International 1 Year Share Price Chart
#2 SRF: Leveraging Fluorochemicals for the Tech Supply Chain
Incorporated in 1970, SRF manufactures and sells technical textiles, chemicals, packaging films, aluminium foils, and other polymers.
SRF reported modest revenue growth but stronger profit in the December quarter. Gross operating revenue for Q3 FY26 rose 6% YoY to Rs 3,713 crore. Net profit increased 60% to Rs 433 crore. The improvement came mainly from the Chemicals business.
Revenue from the Chemicals segment grew 22% to Rs 1,825 crore. The fluorochemicals division saw better realisations as global refrigerant prices remained firm. Supply discipline in China also supported pricing during the quarter.
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SRF is expanding capacity in next-generation refrigerant gases at its Odisha facility. The first phase involves an investment of Rs 1,500–2,000 crore. The company is also adding a second pharma intermediate plant to reduce dependence on agrochemicals.
Pricing pressure continues in specialty chemicals due to competition from China. Management indicated that demand remains stable, but margins will depend on global trends and raw material movements.
Fluorochemicals are widely used in electronics and high-technology manufacturing processes. If semiconductor fabrication gains momentum in India, the need for specialty chemical inputs may increase. Diversified chemical players like SRF could benefit indirectly from such capacity expansion.
In the past year, SRF share price is down marginally.
SRF 1 Year Share Price Chart
#3 KEI Industries: Powering the Semiconductor Infrastructure Build-out
Incorporated in 1968, KEI Industries manufactures wires and cables (W&C) like EHV cables, HT cables, LT cables, and sells them in India and overseas.
KEI Industries posted steady growth in the first nine months of FY26. Revenue rose 21% YoY to Rs 82,714 million. Net profit increased 35% to Rs 6,341 million. The improvement came from better volumes and tighter cost control.
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During the period, the company began commercial production at its new Sanand plant in Gujarat. The first phase was commissioned in December 2025. This facility will expand capacity in low and high tension cables. KEI is also working to grow its extra high voltage cable business.
Exports formed 17% of total revenue, compared with 13% a year ago. The company now serves more than 60 countries and operates overseas offices in select markets.
Management indicated that demand from power and infrastructure projects remains stable. However, profitability will continue to depend on copper and aluminium price trends.
Semiconductor fabs and electronics plants are power-intensive facilities. They require extensive cabling and electrical infrastructure. As manufacturing facilities and data centres expand, cable demand may rise alongside broader electronics capex which may benefit companies like KEI Industries.
In the past year, KEI Industries share price surged 32.5%.
KEI Industries 1 Year Share Price Chart
#4 L&T Technology Services: The Engineering Brains Behind Chip Design
L&T Technology Services (LTTS) is an engineering services provider incorporated in 2012 offers engineering, research and development (ER&D) and digitalization solutions to companies in the areas such as transportation, industrial products, telecom and hi-tech, medical devices and plant engineering.
L&T Technology Services reported revenue of Rs 2,924 crore for the December quarter, up 10.2% YoY. Net profit stood at Rs 329 crore for the period. The company said better project mix and operating discipline supported margins.
Large deal wins during the quarter were valued at $ 180 million. The sustainability segment grew 11.4% YoY, driven by demand in industrial and plant engineering. Mobility showed some recovery after a soft period.
Management said it has exited select low-margin assignments as part of a broader strategy review. For FY26, the company is guiding for mid-single digit growth. It expects margins to improve gradually as higher-value projects scale up.
Semiconductor equipment makers and advanced manufacturing firms often outsource engineering and design services. As global chip-related capex increases, engineering R&D demand could see steady traction. ER&D firms like L&T Technology Services may benefit indirectly from this broader technology cycle.
In the past year, L&T Technology Services share price tumbled 27.1%.
L&T Technology Services 1 Year Share Price Chart
Valuations
Let’s now turn to the valuations of the companies in focus, using the Enterprise Value to EBITDA multiple as a yardstick.
Valuations of Companies in focus
| Sr No | Company | EV/EBITDA Ratio | 5-Year Average EV/EBITDA | ROCE |
| 1 | Navin Fluorine International | 33.1 | 42.0 | 11.7% |
| 2 | SRF | 24.9 | 25.4 | 12.3% |
| 3 | KEI Industries | 32.4 | 28.4 | 21.3% |
| 4 | L&T Tech Services | 16.8 | 23.6 | 28.3% |
Navin Fluorine is trading at 33.1 times EV/EBITDA. This is lower than its 5-year average of 42 times. The stock is cheaper than its earlier highs. However, its ROCE is 11.7%, which suggests returns are still moderate.
SRF trades at 24.9 times EV/EBITDA. This is close to its 5-year average of 25.4 times. Its ROCE stands at 12.3%. The stock appears to be valued in line with its past trend.
KEI Industries is trading at 32.4 times EV/EBITDA. This is above its 5-year average of 28.4 times. The company’s ROCE of 21.3% is stronger, which may justify some premium.
L&T Technology Services trades at 16.8 times EV/EBITDA. This is below its 5-year average of 23.6 times. Its ROCE is 28.3%, which remains healthy.
Overall, valuations vary across sectors. Some stocks are close to their long-term averages. Others are still commanding a premium. Investors should weigh growth prospects against current pricing before taking a view.
Conclusion
The semiconductor opportunity in India is real. Government support is in place. Global supply chains are shifting. This can benefit not only chip makers but also companies that supply materials, services and infrastructure.
However, stock prices already reflect part of this optimism. Some companies are trading near their historical averages. Others are still valued at a premium because of stronger return ratios.
The broader story may remain positive. But investors should stay practical. A strong theme alone does not guarantee returns. Entry price and business quality both matter.
Disclaimer:
Note: We have relied on data from www.Screener.in throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Ekta Sonecha Desai has a passion for writing and a deep interest in the equity markets. Combined with an analytical approach, she likes to deep dive into the world of companies, studying their performance, and uncovering insights that bring value to her readers.
Disclosure: The writer and his dependents do not hold the stocks discussed in this article.
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