These semiconductor stocks rally up to 5% post Budget 2026-27

On the afternoon of February 1, 2026, when the benchmark equity indices NSE Nifty and BSE Sensex traded more than 1% lower, shares of semiconductor-related companies surged as much as 5% after Finance Minister Nirmala Sitharaman announced that the country would further boost its focus on the semiconductor mission.

Cheering the development, shares of RIR Power Electronics Ltd soared 4.99% to Rs 191.60. SPEL Semiconductors Ltd traded 3.51% higher at Rs 176.80 at around 12.55 pm (IST).

The FM in her budget speech said that India Semiconductor Mission (ISM) 1.0 expanded India’s semiconductor sector capabilities. Building on this, the government would launch ISM 2.0 to produce equipment and materials, design fullstack Indian IP, and fortify supply chains. “We will also focus on industry-led research and training centres to develop technology and a skilled workforce,” Sitharaman said.

She also added that the Electronics Components Manufacturing Scheme, launched in April 2025 with an outlay of Rs 22,919 crore, already has investment commitments at double the target. “We propose to increase the outlay to Rs 40,000 crore to capitalise on the momentum,” Sitharaman said while presenting the Union Budget 2025-26.

Commenting on the development, Dhruv Chopra, Managing Partner at Dewan P N Chopra and Co, said, “With the allocation of Rs 40,000 crore for manufacturing electronics components, furthering the India semiconductor mission, India is moving beyond chip assembly to build a complete, self-reliant semiconductor ecosystem. This strategic investment targets the high-value supply chain—including specialised materials and equipment—that currently accounts for a massive portion of our imports. By incentivising domestic production of these core elements, the mission aims to double local value addition and secure India's position as a global nerve centre for high-tech manufacturing."

On the other hand, aerospace-related stocks traded lower despite FM Nirmala Sitharaman announcing an exemption from basic customs duty on raw materials imported for MRO (Maintenance, Repair, and Overhaul). Shares of Taneja Aerospace & Aviation Ltd and Hindustan Aeronautics Ltd traded 4.75% and 2.86% down at Rs 284.50 and Rs 4485.75, respectively, at around 1 pm (IST).