Apple Stock Expected to Rise After Shifting Manufacturing to India

Apple (AAPL) has started manufacturing the iPhone 13 in India, a move that sees it diversify the production of the flagship model outside China. According to a Reuters report, India is among the countries Apple is turning to as it tries to reduce its reliance on Chinese manufacturing.

“We are excited to begin making iPhone 13 — with its beautiful design, advanced camera systems for stunning photos and videos, and the incredible performance of the A15 Bionic chip — right here in India for our local customers,” India’s Business Today newspaper quoted Apple as saying.

Apple’s longtime manufacturing partner, Foxconn, is producing the iPhone 13 at a factory near Chennai in the Indian state of Tamil Nadu.

Apple Expanding Manufacturing Activities in India

The iPhone 13 joins the iPhone 12, iPhone 11, and iPhone SE models that Apple already manufactures in India. The company began producing iPhones in India in 2017, starting with the low-cost iPhone SE. According to Counterpoint Research estimates cited by the Wall Street Journal, India is expected to account for up to 7% of Apple’s global manufacturing in 2022, up from 1.3% in 2020. According to Reuters, in addition to the iPhone, Apple is also expected to start producing iPads in India.

Wall Street’s Take

Deutsche Bank analyst Sidney Ho recently reiterated a Buy rating on Apple with a price target of $210, which indicates 26.7% upside potential.

Consensus among analysts is a Strong Buy based on 23 Buys and five Holds. The average Apple price target stands at $193.36 and implies upside potential of 16.7% to current levels. Shares have gained 17.5% over the past six months.

Hedge Funds

According to TipRanks’ Hedge Fund Trading Activity tool, confidence in AAPL is currently Positive, as 79 hedge funds increased their cumulative holdings of the stock by 849,700 shares in the last quarter.

Key Takeaway for Investors 

Producing iPhones locally in India could help Apple cut down on expert costs, which could in turn allow it to enjoy higher profit margins or price the product more competitively. According to Counterpoint Research data, Apple currently lags far behind Samsung and Xiaomi in smartphone market share in India.

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