SYRMA - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 4.1

📊 Fundamental & Valuation Analysis

Syrma SGS Technology Ltd is a high-growth EMS (Electronics Manufacturing Services) player with strong tailwinds from India’s “Make in India” and China+1 strategies. However, current valuations are stretched

P/E Ratio: 65.7 vs Industry PE of 37.2 — expensive

PEG Ratio: 1.43 — fair for a growth stock

ROE / ROCE: 10.2% / 12.4% — moderate, improving with margin expansion

Dividend Yield: 0.20% — minimal, reinvestment-focused

Debt to Equity: 0.38 — manageable

The company has pivoted toward high-margin segments like industrial, automotive, and healthcare electronics, and entered a JV for PCB manufacturing with South Korea’s Shinhyup Electronics — a strategic move that could boost margins and ROCE over time

1

.

📉 Technical & Trend Analysis

Current Price: ₹746

DMA 50 / DMA 200: ₹614 / ₹535 — strong uptrend

RSI: 83.0 — extremely overbought

MACD: 44.3 — bullish momentum

Volume: Below 1-week average — waning interest

The stock has surged ~98% from its 52-week low of ₹355 and is trading near its all-time high. This suggests short-term overheating.

✅ Ideal Entry Price Zone

Given the technical setup and valuation

Ideal Entry Zone: ₹620–₹670

Wait for RSI to cool below 60 and MACD to flatten

Entry near 50 DMA (~₹614) offers better risk-reward

📈 Long-Term Holding Strategy

If you already hold the stock

Holding Period: 5–7 years, aligned with EMS sector growth and Syrma’s margin expansion strategy

Exit Strategy

Partial exit near ₹850–₹900 if RSI > 80 and valuations exceed 70x PE

Full exit if ROE/ROCE stagnate below 10% or PAT growth slows below 15% for 2+ quarters

Reassess if PCB JV or export growth fails to materialize as expected

Brokerages like ICICI Direct have a 12-month target of ₹825, citing margin enrichment and strategic diversification

1

.

🔍 Summary

Metric Value Verdict

ROE / ROCE 10.2% / 12.4% Moderate, improving

PEG Ratio 1.43 Fair for growth

Dividend Yield 0.20% Minimal

Debt to Equity 0.38 Healthy

RSI / MACD 83.0 / 44.3 Overbought / Bullish

PAT Trend +158% QoQ Strong growth

Syrma is a long-term compounder in India’s EMS space, but current levels are overheated. Ideal for patient investors with a 5+ year horizon.

Would you like a comparison with peers like Kaynes Technology or Dixon to see how Syrma stacks up in the EMS sector?

1

www.icicidirect.com

Edit in a page