CG, Renesas, and Stars Microelectronics, to jointly build outsourced semiconductor assembly and test facility in India

The Union Cabinet, chaired by Prime Minister Shri Narendra Modi, 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 INR 7,600 crores 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 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 the customers worldwide.”