Applied Materials Announces $5 Billion India Expansion Plan Amid Chip-Equipment Sector Rally
On September 18, Applied Materials (AMAT) saw its stock rise nearly 7%, driven by a broader chip-equipment sector rally that included gains in Lam Research and KLA. While the immediate move was attributed to industry-wide momentum rather than company-specific news, the more significant development came from an announcement at SEMICON India on September 17: Applied unveiled 'India Vision 2035,' a $5 billion investment plan over ten years aimed at expanding its presence in the country through research parks and supply-chain infrastructure. This move aligns with broader industry efforts to regionalize manufacturing, as seen also from Lam Research's own $1.2 billion India initiative. The stock’s recovery is supported by CEO Gary Dickerson’s increasingly optimistic revenue forecasts, which now project growth of over 40%. He cited a structural shift in demand toward data centers and advanced packaging technologies like high-bandwidth memory and process control systems. Fiscal Q3 results showed record $9.12 billion in revenue with strong performance from DRAM-related segments. The valuation has become more attractive after the stock dropped to around $445, trading at roughly 25x next twelve months' earnings—considered reasonable for a high-growth company.
Topics: Applied Materials CEO commentary chip equipment sector India expansion