CG Power Secures ₹7,600 Crore Nod for Semiconductor Facility in Gujarat

In a significant move towards bolstering India’s semiconductor manufacturing capabilities, the Union Cabinet granted approval for a ₹7,600 crore ($222 million) semiconductor facility in Sanand, Gujarat, led by CG Power in collaboration with Japan’s Renesas Electronics and Thailand’s Stars Microelectronics. The approval is part of the government’s broader push to establish three semiconductor plants with a combined investment of ₹1.26 lakh crore and incentives totaling ₹76,000 crore to encourage domestic manufacturing.

CG Power and Industrial Solutions will form a joint venture with Renesas Electronics and Stars Microelectronics, aiming to invest ₹7,600 crore over a five-year period. Renesas, a leading Japanese semiconductor company, will contribute advanced technology, while Stars Microelectronics will provide both legacy package technology and training. The facility in Sanand is projected to have a daily capacity of 15 million chips, focusing on consumer, industrial, automotive, and power applications.

The joint venture intends to create an outsourced semiconductor assembly and testing (OSAT) facility, responsible for packaging, assembling, and testing foundry-made silicon wafers to produce finished semiconductor chips. Renesas Electronics America and Stars Microelectronics will hold stakes of 6.76 percent and 0.9 percent, respectively, while CG Power will be the majority stakeholder with 92.34 percent ownership.

Following the government’s approval, CG Power shares witnessed a significant surge, rallying up to 11.38 percent. In January, the company reported a standalone profit after tax of ₹216.47 crore for the October-December quarter. The proposed semiconductor unit aligns with the company’s vision to establish an outsourced semiconductor assembly and test facility.

Other notable approvals include Tata Electronics’ semiconductor fab with Taiwan’s Powerchip Semiconductor Manufacturing Corp in Dholera, Gujarat, requiring an investment of ₹91,000 crore. Additionally, the Tata Semiconductor Assembly and Test (TSAT) proposal for a facility in Jagiroad, Assam, with an investment of ₹27,000 crore, has been greenlit. These projects, along with the previously approved Micron unit, signify a combined investment of over ₹1.26 lakh crore, utilizing a substantial portion of the government’s ₹76,000 crore incentives.

With the semiconductor industry expected to reach $1 trillion globally by 2030 and Indian semiconductor demand projected to exceed $110 billion, these strategic initiatives aim to reduce India’s reliance on semiconductor imports and position the country as a key player in the burgeoning semiconductor market.

Share this article
0
Share
Shareable URL
Prev Post

Arjun Rampal: True happiness lies in your children; not money, fame or fortune

Next Post

Yogi govt set to launch scheme for youth

Read next
Whatsapp Join