Budget 2026: Semiconductor stocks jump up to 7% as FM unveils Mission 2.0 with ₹40,000 cr outlay

In the Union Budget 2026–27 presented on Sunday, Finance Minister Nirmala Sitharaman announced a major push for the semiconductor industry, unveiling Semiconductor Mission 2.0 with a sharply higher outlay of ₹40,000 crore. The initiative aims to strengthen India’s domestic ecosystem through industry-led research, dedicated training centres and targeted support for mineral-rich states.

"We now propose to support the mineral-rich states of Odisha, Kerala, Andhra Pradesh and Tamil Nadu to establish rare earth corridors to promote mining, research and manufacturing," she said.

Reacting to the announcement, semiconductor and electronics-related stocks rallied up to 7% during the special Budget session, as investors bet on sustained policy support for domestic manufacturing.

CG Power & Industrial Solutions surged over 5%, while Dixon Technologies climbed around 5%. Kaynes Technology gained more than 4%, and SPEL Semiconductor advanced nearly 5%. Other stocks such as MIC Electronics, Mindteck India and MosChip Technologies rose between 3–4%. Bharat Electronics (BEL) and Tata Elxsi traded modestly higher, while Vedanta slipped around 2% in early trade.

Among others, GMDC shares gained around 7%, while Orissa Minerals Development Company shares also added up to 7%. NMDC shares pared earlier losses and rose nearly 2%.

Meanwhile, the broader market stayed firm, with the BSE Sensex up 0.44% at 82,633.96 and the NSE Nifty50 higher by 0.25% at 25,383.75.

Earlier, Union Minister for Electronics and Information Technology Ashwini Vaishnaw said India is on track to begin commercial semiconductor production in 2026. Pilot production has already commenced at three plants in 2025, with equipment manufacturers setting up operations, the materials ecosystem taking shape and the talent pipeline strengthening, he said.

“Most of the goals outlined in the first phase of the semiconductor mission are firmly on track, and some are ahead of schedule. For instance, we had set a target to develop 85,000 skilled professionals over 10 years. Within just four years, we have already trained 65,000,” Vaishnaw added, noting that India’s progress is gaining strong global industry support.

Commenting on the Budget announcements, Divam Sharma, Co-founder and Fund Manager at Green Portfolio PMS, said the continued focus on electronics manufacturing and semiconductors is a structurally positive development for markets.

“This is not just a policy announcement but a continuation of a multi-year strategy that markets tend to reward. India’s growing electronics export base is already translating into stronger order books and capacity expansion for several listed EMS players, component manufacturers and capital goods companies. The sustained policy push enhances earnings visibility and supports valuation comfort over the medium to long term.”

Sharma added that the emphasis on strengthening trade ties with the European Union is equally important, as access to stable, high-value export destinations improves revenue durability and reduces cyclicality.

“From an investor perspective, this strengthens the case for export-oriented manufacturing themes, particularly companies already integrated into global supply chains or in the process of scaling up.”

He also highlighted the focus on supply-chain resilience, including initiatives such as the rare-earth corridor.

“In a geopolitically uncertain global environment, securing critical minerals and inputs lowers operational risk and improves cost predictability. This has positive implications for margins and long-term competitiveness.”

Taken together, these measures reinforce India’s positioning as a credible alternative in global value chains. For equity markets, this supports a long-term re-rating opportunity in manufacturing-linked sectors, encourages incremental foreign investment and strengthens the broader structural growth narrative around India.