Cyclone Michaung Affects Chennai Manufacturers: Investors In Apple, Google, Cisco, Dell And Nokia Take Note

Author: Surbhi Jain | December 08, 2023 10:00am

Cyclone Michaung’s intense rain forced many manufacturers operating in industrial areas of Chennai to halt operations for two days, starting Monday. While operations are resuming, investors in stocks of companies manufacturing in that area would be wise to take note.

In the Sriperumbudur SIPCOT SEZ, which is home to large facilities, 60 out of 90 companies have resumed operations. The area houses Apple Inc. (NASDAQ:AAPL) suppliers Foxconn Technology India Pvt. Ltd. and Salcomp Manufacturing India Pvt. Ltd. Foxconn is Apple’s main contractor for the production of a wide range of products, including iPhones and MacBooks.

Salcomp is a supplier of chargers to Apple.

China’s Luxshare Precision Industry Co, which revived the now-defunct Motorola Solutions Inc (NYSE:MSI) factory in Sriperumbudur area, is also a supplier to Apple. Luxshare is Apple’s primary supplier for AirPods and could be an upcoming supplier for iPhones.

Eachangaranai, another area that houses another Apple supplier, Taiwanese Pegatron Corp. has also resumed activity.

Other companies bracing for impact include:

Dell, Hyundai: Irungattukottai, which is home to 206 businesses, including major electronics manufacturer Dell Technologies Inc (NYSE:DELL) and leading automaker Hyundai Motor Co (OTCPK: HYMLF) (OTCPK: HYMLY) (OTCPK: HYMPY) (OTCPK: HYMTF), have resumed production since Wednesday.
Nokia Oyj (NYSE:NOK): One of the company’s largest factories worldwide is also located in the Sriperumbudur area in Chennai. The factory produces a wide range of telecom infrastructure equipment, including 4G and 5G networks. The production of seven million telecom units is a major milestone for Nokia’s Chennai plant.
Automotive Hub: With 110 out of 126 businesses resuming operations, the situation in the Oragadam SEZ was better. The area is another suburban automotive hub that is home to Daimler India, Renault SA (OTCPK: RNLSY)-Nissan Motor Co Ltd (OTCPK: NSANF), and Danfoss Industries.
Cisco Systems Inc (NASDAQ:CSCO): The global technology giant is set to establish a manufacturing plant in Chennai, to produce networking equipment. The move is part of their strategy to diversify their global supply chain and achieve a target of $1 billion in combined domestic production and exports in the coming years. The manufacturing partner for Cisco in India is likely to be Flex India, located in the Oragadam.
Alphabet Inc (NASDAQ:GOOG) (NASDAQ:GOOGL): Indian PM Narendra Modi, has been in talks with Alphabet CEO Sundar Pichai to expand its electronics manufacturing capabilities in India. Google has partnered with Hewlett Packard Enterprise Co (NYSE:HPE) for Chromebook manufacturing in India.