Taiwan’s energy-intensive chip industry is heavily dependent on imported natural gas. Around 37% of its the total natural gas is sourced from Qatar, which has now been disrupted post the Strait of Hormuz blockade after the war broke out last week.Prolonged instability in supply of natural gas may cause potential shortages of chips and their prices are likely to increase.
The chip shortage in the auto sector could lead to reduced vehicle production and higher input costs, according to analysts.
On the flip side, shares of Syrma SGS are down up to 8%, while those of Dixon Tech are at a multi-year low, falling below the ₹10,000 per share mark yet again with today’s 3.5% fall.
The Indian EMS industry has already been facing headwinds, including rising memory chip prices.
Brokerage firm Morgan Stanley also remains “underweight” on Dixon Technologies, with a price target of ₹8,157, which is the lowest on the street for the stock.
The brokerage cited reports from TrendForce mobile, which stated that DRAM prices are expected to rise between 88% to 93% in the first quarter of calendar year 2026 and another 20 to 25% in the second quarter.
An increase in DRAM prices could be an incremental headwind for a sector already seeing subdued trends, Morgan Stanley added.
The Nifty Auto index was down 3.6% around 9.20 am with all 15 stocks in the red, trading 2.6% to 6% lower. Samvardhana Motherson, Tata Motors PV, Ashok Leyland, Uno Minda and Maruti Suzuki were the top five Nifty Auto losers.
EMS stocks Amber Enterprises, Kaynes Tech, Dixon Tech, PG Electroplast were trading 3.5% to 8% lower.
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