India is planning a major push to reduce its dependence on China for rare-earth permanent magnets. The government is expected to approve a Rs. 7,300 crore incentive scheme to support companies that can manufacture these magnets within the country. This scheme will run for seven years and aims to create a fully local production system.
Today, China controls about 60 percent of rare earth mining and nearly 90 percent of the processing work. Because of this domination, India relies almost completely on imports for rare earth magnets, which are used in electric vehicles, electronics, defense systems, and renewable energy technologies.
The new scheme hopes to change this by helping local and global companies set up advanced facilities in India. These facilities will focus on converting rare earth materials into metals, alloys, and finally strong magnets, an area where India lacks technology and infrastructure.
India has around 6.9 million metric tonnes of rare earth reserves, but it produces only about 2,900 tonnes a year. Meanwhile, the country needs around 4,010 tonnes of magnets now, and this demand may go up to 8,220 tonnes by 2030. With this scheme, India aims to build a strong homegrown ecosystem and cut its dependence on China.
Out of the total Rs. 7,300 crore budget, Rs. 6,500 crore will go toward setting up plants and equipment, while Rs. 800 crore will support operational needs. With this investment, India aims to build a strong, independent rare earth magnet industry that can support its growing clean energy and technology sectors.
Here are a few Indian Companies that might benefit from the ₹7,300-Crore Rare Earth PLI Scheme
Sona BLW Precision Forgings Limited (Sona Comstar)
With a market capitalization of Rs. 31,368.93 crore, the shares of Sona BLW Precision Forgings Limited were currently trading at Rs. 504.55 per equity share, rising nearly 0.61 percent from its previous day’s close price of Rs. 501.50.
Sona BLW (Sona Comstar), a major EV traction motor manufacturer and heavy user of NdFeB magnets, will directly benefit from the PLI scheme. With India boosting local magnet production, the company can expect a more reliable supply, lower dependency on imports, and improved cost efficiency for its growing EV motor business.
Bharat Forge Limited
With a market capitalization of Rs. 68,156.32 crore, the shares of Bharat Forge Limited were currently trading at Rs. 1,425.60 per equity share, rising nearly 1.20 percent from its previous day’s close price of Rs. 1,408.75.
Bharat Forge, active in defence, aerospace, and EV components, is set to gain directly from the PLI scheme. As the company is likely to invest in magnet alloy and metal production stages, the scheme will support its expansion into high-value rare earth processing, strengthening India’s strategic and advanced manufacturing capabilities.
JSW Group (JSW Steel / JSW Energy)
JSW Energy Limited has a market capitalization of Rs. 85,142.54 crore, with its shares currently trading at Rs. 487.15 per equity share. Further, JSW Steel Limited has a market capitalization of Rs. 2,82,327.66 crore, and its shares are currently priced at Rs. 1,154.50 per equity share.
JSW Group, through its steel and energy businesses, stands to benefit directly from the PLI scheme as it expands into strategic materials and advanced energy storage. With its growing focus on future-ready technologies, the group is a strong candidate for investing in rare earth processing, supporting India’s shift toward self-reliance in critical materials.
Servotech Renewable Power System Ltd
With a market capitalization of Rs. 2,105.78 crore, the shares of Servotech Renewable Power System Limited were currently trading at Rs. 93.24 per equity share, down nearly 1.67 percent from its previous day’s close price of Rs. 94.82.
Servotech Power Systems, known for EV chargers and power electronics, will indirectly benefit from the PLI scheme. Even though it doesn’t make magnets, the reduced cost of NdFeB magnets will lower prices of motor-based components used in chargers and power systems, improving overall product affordability and strengthening the EV ecosystem.
Dixon Technologies (India) Limited
With a market capitalization of Rs. 89,836.36 crore, the shares of Dixon Technologies (India) Limited were currently trading at Rs. 14,815 per equity share, rising nearly 2.88 percent from its previous day’s close price of Rs. 14,400.20.
Dixon Technologies, a major player in consumer electronics manufacturing, will indirectly benefit from the PLI scheme. With local production of rare earth magnets, the cost of BLDC motors, widely used in fans, appliances, and small electronics, will decrease. This will help Dixon produce more affordable products and strengthen domestic manufacturing competitiveness.
Amber Enterprises India Limited
With a market capitalization of Rs. 25,721.31 crore, the shares of Amber Enterprises India Limited were currently trading at Rs. 7,313 per equity share, rising nearly 2.73 percent from its previous day’s close price of Rs. 7,143.40.
Amber Enterprises, a leading manufacturer of ACs, fans, and compressors, will indirectly benefit from the PLI scheme. As a major user of BLDC motors, the availability of locally produced rare earth magnets will help reduce motor costs, making appliances more affordable and enhancing the company’s manufacturing efficiency.
Larsen & Toubro Limited
With a market capitalization of Rs. 5,58,637.15 crore, the shares of Larsen & Toubro Limited were currently trading at Rs. 4,061.10 per equity share, rising nearly 1.63 percent from its previous day’s close price of Rs. 3,995.80.
L&T, with its strong presence in defence electronics and missile systems, will indirectly benefit from the PLI scheme. These sectors require high-performance rare earth permanent magnets (REPM). Local magnet production will help secure supply, reduce import dependence, and support smoother manufacturing of advanced defence technologies.
Written By – Nikhil Naik
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