India’s digital economy is coming into a part the place demand is transferring past software program and connectivity. The fast enlargement of Artificial Intelligence, cloud computing and data centres is creating new alternatives throughout the expertise worth chain.
The Data and Communications Expertise (ICT) trade sits on the intersection of those developments. India’s ICT market was valued at US$43 billion in FY24 and is predicted to achieve US$75 billion (round ₹7 lakh crore) by FY29. Rising digital adoption, AI, cloud computing, 5G and the rapid build-out of digital infrastructure are anticipated to help this progress.
Nonetheless, the chance just isn’t restricted to corporations constructing new digital infrastructure. Rising memory prices are making refurbished electronics comparatively cheaper, as companies search for cost-effective options. On the identical time, expertise distributors are transferring up the worth chain by increasing into information centre enterprise options.
The Twin Method to Digital Development
This positions them to learn from rising infrastructure spending. In opposition to this backdrop, two distributors provide other ways to play the increasing digital infrastructure alternative in India. One faucets the rising demand for refurbished electronics, whereas the opposite expands into information centre options as AI and cloud adoption speed up.
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Right here’s why these corporations deserve a more in-depth look.
#1 Rashi Peripherals
Rashi Peripherals is an Data and Communications Expertise (ICT) distributor in India. The corporate sells expertise merchandise in partnerships with 80 world expertise manufacturers. With 57 branches and 50 service centres throughout 20 areas, the corporate reaches 706 areas.
Core Verticals & AI Tailwinds
Rashi Peripherals manages its enterprise via two most important verticals. Private Computing and Enterprise Options (PES) is the biggest enterprise vertical, contributing 66.3% of income. PES delivers bundled enterprise expertise options (PCs, servers, information centres, and storage) to enterprise, authorities, and institutional shoppers.
It’s at the moment benefiting from a serious trade super-cycle pushed by 3 tailwinds. The primary is a multi-year PC refresh cycle triggered by the transfer away from Home windows 10. The second is accelerating demand and adoption of higher-average-selling-price, AI-enabled PCs.
The third is the affect of rising element prices and better costs, pushed by structural constraints in reminiscence capability (comparable to typical DRAM and NAND flash) and world AI information centre demand.
The Way of life and IT Necessities (LIT) section contributes 33.7% of income. This section focuses on standalone shopper expertise merchandise like equipment, gaming, wearables, and on a regular basis objects. Rashi is leveraging its extensive attain to proceed gaining market share. That is comparatively a high-inventory-turnover mannequin.
Increasing Margins: The VDA Acquisition & Knowledge Centre Push
Rashi is transitioning from a pure-play distributor to a high-value built-in options accomplice. To take action, administration has prioritised a high-margin, capital-efficient information centre enterprise. It’s leveraging its pre-sales, logistics, and set up experience in smaller data centre component transactions within the ₹20 crore to ₹70 crore vary.
Rashi focuses on neo-clouds, smaller cloud service suppliers, and area of interest operators who present specialised AI-based options of their information centres. These tier-2 operators provide a steady, common run-rate shopping for cycle, which inserts Rashi’s high-turnover enterprise mannequin. Rashi goals to leverage its relationship with NVIDIA and Supermicro to take part in these deployments.
In Q1FY27, Rashi acquired a majority stake in VDA Infosolutions, a methods integrator throughout India. VDA generated ₹850 crore in FY26 and helped Rashi transfer up the worth chain and right into a secure, common service income stream. This consists of enterprise implementation, consulting, managed IT providers, cloud, and cybersecurity.
The corporate has partnered with WEKA to develop into AI infrastructure and high-performance workload administration. Its alliance with Dell Applied sciences to distribute business servers, storage, displays, and laptops is progressing properly. Dell contributed roughly 5% to the enterprise in Q1FY27, exceeding inner estimates.
The Restar Joint Enterprise: Scaling Semiconductors
For Rashi, Semiconductors are a key long-term growth lever. It is because the corporate’s Q1FY27 semiconductor revenues had already crossed 70% of FY26 semiconductor income. To scale this section, Rashi has shaped a 74:26 JV with Restar, a $4 billion Tokyo-listed semiconductor expertise firm.
The three way partnership will concentrate on creating superior picture sensing options for robotic, industrial, and automotive functions in India. Rashi will obtain direct distribution rights for Restar’s world portfolio. It is going to additionally obtain expertise switch and entry to main Japanese automotive and manufacturing clients working in India.
Restar will deploy Japanese design consultants to native design labs (comparable to Bangalore) to coach Rashi’s engineering staff. Administration has conservatively guided for greater than US$100 million (₹950 crore) in income underneath the JV throughout the subsequent three years. The enterprise will command a considerably larger margin profile than its core IT distribution enterprise.
Q1 FY27 Monetary Breakdown
Financially, consolidated income from operations grew by 61.9% to ₹5,101.9 crore. EBITDA (Earnings Earlier than Curiosity, Tax, Depreciation, and Amortisation) surged 50% to ₹155.3 crore, whereas margins contracted barely by 24 bps to three%. Internet Revenue rose by 69.5% to ₹104.6 crore. Working capital cycles additionally improved from 73 days to 56 in Q1FY27.
Wanting forward, administration is optimistic about Q2FY27, which has traditionally been a peak quarter. Robust business momentum and excessive shopper sentiment are anticipated to persist. Nonetheless, the tempo of element value will increase is projected to decelerate.
Administration is assured it’ll keep its most important long-term progress trajectory of 20% CAGR, primarily based on its 20-year monitor document.
#2 GNG Electronics
GNG Electronics operates underneath the consumer-facing model “Electronics Bazaar.” The corporate sells refurbished units with a one- to three-year guarantee to construct institutional belief. GNG now provides refurbished expertise to 49 nations, up from 46 nations on the finish of FY26.
Moreover, GNG Electronics has expanded its bodily and retail footprint to greater than 5,130 buyer touchpoints globally. Its sourcing community consists of 773 suppliers throughout areas.
World Footprint & Q1 Income Combine
India stays its largest market, contributing 36% of income in Q1FY27. The US contributed 24%, adopted by Europe (23%), and the Center East contributed 12%, leaving different areas at roughly 5% of the overall combine.
Operationally, the corporate offered 108,000 laptops throughout the quarter, which accounted for 81% of income realisation. Desktops and different classes contributed the remaining portion of gross sales with 42,000 models.
ASP Growth & The Reminiscence Tailwind
Unit economics additionally expanded strongly, with laptop computer common promoting costs rising to ₹30,763, up 12% year-on-year from ₹27,500 within the first quarter of FY26. Equally, the ASP for desktops and different classes rose 10% year-on-year to ₹19,326, up from ₹17,500 in Q1FY26.
The core driver for GNG is rising reminiscence element costs. Reminiscence element costs surged a further 5% to 10% throughout Q1FY27, with 8 GB DDR5 reminiscence priced at $126 and 16GB DDR5 reminiscence at $231. Since October 2025, DDR reminiscence costs have truly elevated almost fivefold, offering a considerable tailwind to GNG’s pricing energy.
In the meantime, the worth of a brand new entry-level laptop computer with 8GB of RAM and a 512GB SSD has risen from ₹40,000 to ₹48,000. This has led to a worldwide PC provide scarcity of about 3 crore models by June CY2026. This provide scarcity and rising PC costs have pushed corporations, college students, and establishments to refurbished options.
Profitability Surges on Operational Leverage
The corporate’s Q1FY27 financials mirror this momentum. Though models elevated by low double digits, income grew by 32.1% to ₹412.5 crore. EBITDA grew 50.4% to ₹52.9 crore, with EBITDA margin increasing by 156 foundation factors to 12.8%. This robust execution translated on to the underside line, with internet revenue rising 56.2% to ₹28.9 crore.
Upgraded FY27 Steerage & Stock Technique
To hedge towards these rising {hardware} prices and defend its realisations, GNG had a listing of about ₹700 crore on the finish of Q1FY27. This strategic stock permits the corporate to safe PCs at low prices, keep pricing energy, and fulfil massive institutional orders immediately.
On the distribution entrance, throughout Q1FY27, GNG partnered with Redington Limited, India’s main expertise distributor. This partnership enhances GNG’s current relationships with different nationwide distributors, together with Ingram (ranked second in India) and Supertron (ranked fifth).
After a powerful Q1FY27, administration has upgraded its full-year steering for FY27. The corporate now expects income progress of 30%, up from 25% beforehand. As well as, the corporate has elevated its internet revenue margin progress goal to 0.75% to 1.0%, up from the earlier goal of 0.5%.
The Valuation Mismatch: Low cost vs Development Premium
With larger margins and thus superior profitability progress, GNG boasts a comparatively larger Return on Capital Employed (ROCE) and Return on Fairness (ROE) than Rashi. From a valuation perspective, after a close to 100% upside in 2026, GNG now trades at almost double the trade median P/E, whereas Rashi trades at a reduction.
| Peer Comparability (X) | ||||
| Firm | Value-to-Earnings A number of | Return Ratios | ||
| Firm | Trade | ROCE (%) | ROE (%) | |
| Rashi | 17.4 | 24.0 | 16.8 | 14.7 |
| GNG | 45.2 | 24.0 | 20.3 | 26.8 |
| Supply: Screener.in (Knowledge as of 14 August 2026) | ||||
Rashi and GNG Electronics provide two distinctive performs on India’s evolving expertise cycle.
Rashi is constructing past distribution, with information centres, AI infrastructure and semiconductors opening higher-value income swimming pools. GNG, in the meantime, is benefiting from a extra instant set off as surging reminiscence costs widen the associated fee hole between new and refurbished units.
Nonetheless, the trade-off is valuation. Rashi presents relative valuation consolation, whereas GNG instructions a progress premium because of its higher-margin profile. That mentioned, you can keep these names on your watchlist to trace execution.
Disclaimer:
Be aware: All through this text, we’ve relied on information from http://www.Screener.in and the corporate’s investor presentation. We used an alternate, broadly used, and accepted supply of knowledge solely when the info was unavailable.
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Concerning the Writer: Madhvendra has been deeply immersed within the fairness markets for over seven years, combining his ardour for investing along with his experience in monetary writing. With a knack for simplifying complicated ideas, he enjoys sharing his sincere views on startups, listed Indian corporations, and macroeconomic developments.
A devoted reader and storyteller, Madhvendra thrives on uncovering insights that encourage his viewers to deepen their understanding of the monetary world.
Disclosure: The author and his dependents don’t maintain the shares mentioned on this article.
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