Samvardhana Motherson Sumi Group, one of the world’s leading automotive component makers for original equipment manufacturers (OEMs) is entering into the Semiconductor Chip Manufacturing and is currently looking for a global business partner for this space.
To foster Government’s Make in India objective and to build capabilities in an industry providing significant content to each new-age vehicle, the Indian conglomerate has already acquired 300 acres on the outskirts of Chennai. The group is planning to invest $1 billion in the next three years as a part of its capex plan.
Setting up a semiconductor manufacturing and the investment it hold is itself a large and a huge process, therefore to get into the semiconductor space the company is eyeing for a global partner. Laksh Vaaman Sehgal, Vice-Chairman of Samvardhana Motherson says that they have set up a 300-acre industrial park in Chennai so as to bring good manufacturing partners into the country. They are actively looking at the Semiconductor space and are willing to collaborate. If any global giant is planning to invest in India and can bring the semiconductor technology in India then they are open for an alliance.
Before Motherson Group, both the Tata Group and the Vedanta Group have shown their enthusiasm and committed to investing in the semiconductor space in India. The country’s automotive market has seen a tremendous shortage of chips that has already led to losses of billions of dollars, therefore New Delhi will also be incentivizing investment into localization of chips.
Driven by higher usage of wireless communication, consumer electronics, and automotive in the country, the semiconductor requirement in India is expected to grow at 33% annually between 2020 and 2026 to reach $63 billion. These three segments are likely to account for about 20-24% of the total semiconductor requirement of the country. The demand for semiconductors in India is valued at over US$10 billion, setting up a Semiconductor Chip Manufacturing facility in India would be a great deal for investors and of great interest to boost the economy and employment.
