Syrma SGS Technology Ltd.

“Syrma SGS participates in a genuine structural growth story — India EMS — but is a below-average operator within it: thin 6-7% EBITDA margins, incremental ROIC well below cost of capital, persistent margin over-guidance, and an IT hardware segment that dilutes every quality metric. At 47x forward earnings with no margin of safety, investors are paying a compounder price for a commodity-assembly business. Realistic 10-year returns of 1.5-2.5x total (4-10% CAGR) are insufficient compensation for the earnings quality and execution risk embedded in this business. The India EMS theme is better expressed through Kaynes or Dixon at comparable or cheaper multiples with demonstrably superior economics.”