CG Power and Industrial Solutions Limited, a subsidiary of Tube Investments of India Limited and the Murugappa Group, along with Renesas Electronics Corporation, a leading provider of advanced semiconductor solutions, and Stars Microelectronics Public Co. Ltd, a Thailand-based Outsourced Semiconductor Assembly and Test provider, have recently entered into a Joint Venture Agreement to establish and operate an OSAT facility in India. The Joint Venture project has been approved by the Union Cabinet, chaired by Prime Minister Narendra Modi, under India's Semiconductor scheme.
The Joint Venture combines the distinct strengths of the partners with the aim of 'Making in India for the World' With approximately 86 years of manufacturing experience, CG is enthusiastic about fostering semiconductor capabilities and ecosystems within India. Renesas, a prominent semiconductor firm headquartered in Japan, will contribute advanced semiconductor technology and expertise. Stars Microelectronics, based in Thailand and specializing in OSAT, will offer both legacy package technologies and training and support.
The Joint Venture will be predominantly owned by CG, holding 92.3% of the equity, while Renesas and Stars Microelectronics will each have ownership stakes of approximately 6.8% and 0.9%, respectively. Over a five-year span, the JV intends to invest INR 7,600 crores, utilizing a combination of subsidies, equity, and potentially bank borrowings as necessary. Establishing a cutting-edge manufacturing facility in Sanand, Gujarat, the JV aims to reach a production capacity of up to 15 million units per day. The facility will produce a diverse range of products, spanning from traditional packages like QFN and QFP to advanced options such as FC BGA and FC CSP.
Commenting on this new venture, Mr. S. Vellayan, Chairman, CG Power and Industrial Solutions Limited, said, "CG's entry into the semiconductor manufacturing marks a strategic diversification for us. 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".
Commenting on the partnership, Mr. Hidetoshi Shibata, CEO of Renesas, 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 customers worldwide".
Mr. Prompong Chaikul, Chairman of Executive Committee of Stars Microelectronics Public Co., Ltd added, "We are deeply honored 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".