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Auto Parts Surge: India's PLI Scheme Fuels Growth
19 Aug
Summary
- Automobile PLI scheme attracted ₹44,326 crore by March 2026.
- FIIs and DIIs are aggressively increasing stakes in auto-components firms.
- NRB Bearings and Craftsman Automation are expanding into new sectors.
India's automobile and auto-component Production Linked Incentive (PLI) scheme has surpassed its investment targets, attracting ₹44,326 crore by the end of March 2026 against a goal of ₹42,500 crore by March 2027. This financial success is paralleled by a notable increase in institutional investor confidence.
During the April-June 2026 quarter, Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) significantly raised their stakes in two prominent auto-component stocks, NRB Bearings Ltd. and Craftsman Automation Ltd. NRB Bearings, a needle roller bearing manufacturer, is diversifying into electrification and aerospace, while Craftsman Automation is expanding its powertrain and aluminum product lines.
NRB Bearings is focusing on EV-agnostic solutions and has secured aerospace and defense orders. Craftsman Automation is undertaking a ₹1,500 crore capital expenditure, including a new facility for high-pressure die-casting, and sees significant opportunity in heavy-horsepower engines.
Despite robust growth and expansion plans, both companies are currently trading at premium valuations. Investors are closely watching their execution of diversification strategies and capacity additions to justify these valuations and sustain future revenue growth.
