India’s contract manufacturing powerhouse, Zetwerk, is gearing up for a potential stock market listing within the next 15 to 24 months, as the company accelerates its electronics production capabilities. The move comes at a time when global supply chains are shifting away from China, and India is emerging as a key player in the manufacturing sector.
India’s Manufacturing Boom
Zetwerk’s CEO and co-founder, Amrit Acharya, highlighted the significance of this transition, stating, “Global companies are moving production to India. This is happening today; this will happen once in our lives probably.”
Electronics manufacturing in India has been on the rise as industry giants such as Google (NASDAQ: GOOG) and Apple (NASDAQ: AAPL) diversify their supply chains to mitigate risks associated with over-reliance on China. Josh Foulger, Zetwerk’s electronics president, echoed the sentiment, affirming that “India is going to be a long-term bet for any global supply chains.”
Growth Trajectory and IPO Plans
Zetwerk, which secured approximately $90 million in funding last year at a valuation of $3.1 billion, has ample capital to expand its electronics operations. Acharya confirmed that the company is strategically planning its initial public offering (IPO), which is expected to take place within the next two years.
The contract manufacturer follows in the footsteps of Dixon Technologies (NSE: DIXON), which went public in 2017, a year before Zetwerk was founded. The company’s recent expansion moves are setting the stage for a strong market debut.
Chennai: The Next Export Hub
On Saturday, Zetwerk inaugurated its seventh factory in Chennai, marking a major step in its mission to establish the city as a key export hub, particularly targeting the U.S. market.
This expansion comes amid geopolitical shifts, including heightened trade tensions between the U.S. and China under former President Donald Trump. While Trump’s tariffs on China are expected to benefit Indian manufacturers, potential tariffs on Indian exports remain a concern. As a strategic countermeasure, Zetwerk has accelerated its European expansion plans by up to four years, already signing up multiple clients in the region.
Financial Performance and Market Outlook
Electronics currently contribute to 15% of Zetwerk’s total revenue. In the fiscal year ending March 2024, the company reported a 26% increase in revenue, reaching 144.36 billion rupees ($1.66 billion). However, its net loss widened significantly to 9.19 billion rupees, compared to 1.09 billion rupees the previous year.
Despite the losses, Zetwerk’s strategic growth, increasing demand for India-based manufacturing, and a robust funding pipeline position it well for long-term success. With global supply chains evolving and India gaining prominence as a manufacturing hub, Zetwerk’s potential IPO could mark a significant milestone in the country’s industrial landscape.
($1 = 86.9410 Indian rupees)
