The Indian electronics manufacturing services sector, or EMS sector, is back in the spotlight. The brokerage firm, JP Morgan has its eyes on a few top picks.

Even though some of the bigger names have stumbled recently, the brokerage report says there is still potential in the sector. So, which stocks should investors watch closely?

Let’s take a look at brokerage outlook on the top winners and losers –

Winners and losers in the EMS sector

According to the brokerage report, “Our Indian EMS coverage universe has delivered widely divergent outcomes since the end of the 2nd quarter (September) FY26 results.”

Some market favourites have struggled, with Kaynes Technology down 35% and Dixon Technologies (India) down 29%, compared to a 12% fall in the Nifty. On the other hand, Avalon Technologies, Amber Enterprises India, and Syrma Technology have been holding up better, falling 8-11%.

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Furthermore, the report pointed out that, aside from Dixon, every stock is expected to grow revenue by more than 20% over FY26-28.

“We see evidence of bottoming in that YTD none of the stocks are underperforming, and Syrma, Amber and Avalon are all now outperforming by 10-12% YTD,” added the brokerage house.

From finished goods to components – A big shift

JP Morgan highlighted that the EMS sector is evolving. Companies are moving from just assembling finished products to manufacturing electronic components and printed circuit boards (PCBs).

The report notedd, “Syrma, Amber and Kaynes have received the required approvals for their bare PCB foray while Dixon has received approval for component manufacturing, thereby providing growth visibility.”

The brokerage expects the EMS sector to deliver strong revenue growth of over 20% in the next two years, and excluding Dixon, growth could reach 30%.

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Syrma Technology in the spotlight

Among the picks, Syrma Technology stands out. JP Morgan added that the company began building multi layer PCB production capacity in December 2025, with construction expected to finish by mid-2026 and trial production from December 2026. Revenues from this expansion are expected in FY28.

“This should be margin accretive, with EBITDA margins of 15-17%. It will incur capex of Rs 3.5-4 billion each in FY27 and FY28,” the report added. Syrma is working across Industrial, Automotive, and Consumer segments, and is considered a “cleaner way to play EMS” because it has low exposure to cyclical businesses and minimal risk to FY27/28 earnings estimates.

Upgrades and outlook

JP Morgan has upgraded Amber Enterprises and Cyient DLM to ‘Overweight’ from ‘Neutral.’.

The brokerage expects Syrma and Amber to exceed market expectations, while valuations have eased but remain between 32-60 times FY27 estimates for stocks that fail to meet estimates.

The report also shared a pecking order for EMS stocks – Syrma, Dixon, Amber, Kaynes, Cyient DLM, and Avalon. This reflects a mix of growth potential, approvals in hand, and current market positioning.

Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.