JV to set up manufacturing facility in Sanand, Gujarat and plans to invest Rs 7,600 crore over a five-year period
Chennai, NFAPost: CG Power and Industrial Solutions, part Murugappa Group, Renesas Electronics Corporation, a premier supplier of advanced semiconductor solutions and Stars Microelectronics (Thailand) Public Co Ltd, a Thailand-based outsourced semiconductor assembly and test (OSAT) provider; have signed a joint venture agreement to establish a joint venture (JV) to build and operate an OSAT facility in India.
The Union Cabinet approved the project of the JV under India’s Semiconductor Scheme on February 29, 2024. The JV brings together unique capabilities of the partners with a vision to ‘Make in India for the World.’
CG, with around 86 years of manufacturing expertise, is keen to build semiconductor capabilities and ecosystem in India. Renesas, a leading semiconductor company headquartered in Japan, will provide advanced semiconductor technology and expertise. Stars Microelectronics, a Thai based OSAT, will provide both technology for legacy packages and training and enablement.
The JV will be 92.3% owned by CG, with Renesas and Stars Microelectronics each holding equity capital of approximately 6.8% and 0.9%, respectively. The JV plans to invest Rs 7,600 crore over a five-year period, which will be financed through a mix of subsidies, equity, and potential bank borrowings as required.
The JV will set up a state-of-the-art manufacturing facility in Sanand, Gujarat, with a capacity that will ramp up to 15 million units per day. The JV will manufacture a wide range of products – ranging from legacy packages such as QFN and QFP to advanced packages such as FC BGA, and FC CSP. The JV will cater to industries such as automotive, consumer, industrial, 5G, to name a few.
Commenting on the new venture, CG Power and Industrial Solutions Chairman S Vellayan said CG’s entry into the semiconductor manufacturing marks a strategic diversification for the company.
“Our partners, Renesas and Stars Microelectronics, will make our learning curves steeper and help us focus on innovation and excellence. This is a very exciting phase for the entire nation, and we are very keen to build out India’s semiconductor capability and ecosystem,” said CG Power and Industrial Solutions Chairman S Vellayan.
CG Power and Industrial Solutions MD Natarajan Srinivasan said it is a matter of great pride for CG to implement this project of national importance.
Commenting on the partnership, Renesas CEO Hidetoshi Shibata said India is a critical part of Renesas’ business.
“We value its innovative landscape and robust potential growth and are committed to accelerating our investment in India. By partnering with the Murugappa Group and Stars Microelectronics, we will bolster India’s semiconductor ecosystem and address the growing semiconductor demand for the customers worldwide,” said Renesas CEO Hidetoshi Shibata.
Stars Microelectronics Chairman Of Executive Eommittee Prompong Chaikul said Stars Microelectronics is deeply honoured to join forces in this thrilling venture.
“Leveraging our expertise and experience in OSAT, we are committed to providing robust support to ensure the success of this project in India,” said Stars Microelectronics Chairman Of Executive Eommittee Prompong Chaikul.
