Chennai: Syrma Technology and SGS Tekniks on Wednesday announced a merger agreement to further strengthen their design and manufacturing capabilities for global and domestic OEMs.
The cash cum stock merger will see the creation of Syrma SGS Technologies with a combined turnover of over Rs.1000 crores, with 55% revenues coming from exports primarily to the USA and Europe. The deal was supported through a private equity investment by GEF.
“The current revenue of Syrma is over Rs 550 crore, post the merger we’ll have a combined revenue of Rs 1000 crore,” said Sandeep Tandon, Managing Director, Syrma Technology. “We’re projecting growth between 25% to 30% year-on-year and by 2021 we aim to achieve Rs 1200 crore in revenue.”
Tandon said that with the Indian EMS market is growing at a CAGR of over 25%, there’s an increase in the opportunity to outsource manufacturing in consumer electronics, home appliances, mobile phones, and so on.
“Application areas such as medical electronics and defense electronics are seeing a surge leading to growth in the overall electronics sector. With the government recently announcing incentive schemes like PLI, Specs, and EMC 2.0, for developing the ecosystem, there’s a bigger need for technological advancement in the EMS sector,” Tandon said.
Further, there’s a huge opportunity to add IoT to a wide range of products.
“With the projected global growth of IoT products to well over US$5 Tn and the Indian IoT market keeping pace, the opportunities are quite exciting for the combined entity,” the company said in a statement.
Upon completion of this merger, Syrma SGS Technologies will have 8 manufacturing facilities in India across Gurgaon, Manesar, Bawal, Baddi, Bangalore, Chennai, Bargur, and three design centers in Chennai, Gurgaon, and Stuttgart (Germany).
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