Indian govt approves Kaynes’ $413 million chip plant in Gujarat
The Kaynes OSAT unit will have a capacity of 6 million chips per day, which will be used across sectors including industrial, automotive, EVs, consumer electronics, telecom and mobile phones.
The Indian government has approved Kaynes Semicon’s ₹33 billion (approximately USD 413 million) OSAT unit in the western Gujarat state, becoming the fifth such project in the country to get the government’s nod under the ₹760 billion (USD 9.5 billion) semiconductor incentive scheme.
The Kaynes OSAT Sanand unit will have a capacity of 6 million chips per day, which will be used across sectors including industrial, automotive, EVs, consumer electronics, telecom and mobile phones.
Four of the five projects announced by the government are in Gujarat.
The other four projects are the Tata group-Powerchip Semiconductor (PSMC) plant in Dholera (Gujarat), Tata’s ATMP unit in Assam, Micron’s ATMP project in Sanand (Gujarat) and CG Power’s ATMP unit in Sanand (Gujarat).
“We have always maintained that the semiconductor mission is a programme for atleast ten years minimum. This is a long programme. There will be an increased outlay for sure and we will come back with the details as in when they are finalised,” Ashwini Vaishnaw, India’s minister of electronics and information technology, said. “This is a foundational industry and has a multiplier impact on other industries and jobs creation.”
As per the incentive scheme, the central government provides fiscal support of 50% of the project cost.
Kaynes is a wholly-owned subsidiary of Karnataka-based electronics manufacturing services (EMS) company Kaynes Technology.
“The plant at a full-blown capacity is expected to generate about 10,000 jobs – 5,000 direct and remaining indirect,” Raghu Panicker, CEO of Kaynes Semicon, told the Financial Express. “We have three customers aligned already and in the next 6-8 months after the construction is done, we will start the production.”
Kaynes Semicon already has three customers from Singapore, Taiwan and the US on board.
“The company is targeting to have 13 chip assembly and test lines over the next 1.5-2 years with a volume of 1 billion chips annually,” Panicker said.
In October last year, Kaynes had announced a plan to set up an OSAT and compound semiconductor facility in the southern Telangana state with an estimated investment of ₹28 billion. However, the status of that proposal is unclear.