Synopsis:
India’s semiconductor sector is growing fast with strong government support under the India Semiconductor Mission (ISM) and a Rs 76,000 crore PLI scheme, of which Rs 65,000 crore is already committed. New factories and jobs are emerging, propelling India towards becoming a global hub for chip manufacturing.
Its goal is to set up semiconductor fabrication plants, display manufacturing, chip design, and packaging and testing facilities, all while fostering startups and developing skilled talent.
What are Semiconductors, and how are they made?
Semiconductors are fascinating materials that can partially conduct electricity, and they’re primarily made from silicon. You’ll find them at the heart of chips that power nearly all our electronic gadgets, from smartphones and laptops to cars and even satellites.
The process of making chips can be broken down into three key steps. It all starts with the design phase, where the concept for the chip is crafted and mapped out using specialized software. Then, we move on to fabrication, where the chip is physically constructed in a clean-room setting, utilizing silicon wafers, various chemicals, and gases.
Finally, we have the assembly, testing, and packaging (ATP) stage, where the finished chip is put together, undergoes quality testing, and is packaged for distribution. To create these chips, we rely on cutting-edge manufacturing equipment, top-notch raw materials, and advanced software to guarantee both precision and efficiency.
India’s Semiconductor Industry
The global semiconductor market is expected to reach $1 trillion by 2030. According to reports, India’s Semiconductor market was about $38 billion in 2023, $45-50 billion in 2024-2025, and is estimated to reach $100-110 billion by the end of 2032.
One standout is Micron Semiconductor, which is planning a state-of-the-art chip packaging and testing facility in Gujarat, backed by an investment of Rs 22,516 crore. Meanwhile, HCL-Foxconn is busy constructing a Rs 3700 crore fab near Jewar in Uttar Pradesh.
Global tech leaders are also placing their bets on India’s semiconductor boom. For instance, Lam Research has signed a memorandum of understanding to invest over $1 billion in Karnataka to enhance the chip ecosystem’s infrastructure.
Additionally, L&T Semiconductor Technologies is aiming to build a $10 billion fabrication plant by 2027, contingent on hitting certain revenue targets, with government incentives potentially covering up to 90 percent of the costs.
On top of that, Tata Electronics is making strides by establishing India’s first homegrown assembly and testing unit in Assam, which is valued at around Rs 27,000 crore and is expected to create tens of thousands of jobs.
Also, Tata Electronics in partnership with Powerchip Semiconductor Manufacturing Corp (PSMC) of Taiwan, invested Rs 91,000 crore with a capacity of producing 50,000 wafers per month.
To date, India has approved 10 semiconductor projects across six states, including its first Silicon Carbide fab in Odisha and an advanced packaging unit. With a total investment of Rs 1.60 lakh crore, these projects aim to position India as a global leader in semiconductor manufacturing.
| Company | Location | Investment | Output Capacity |
| Micron Technology | Sanand, Gujarat | Rs 22,516 crore | ATMP Facility, with phased ramp-up. |
| Tata Electronics (TEPL) in partnership with Powerchip Semiconductor Manufacturing Corp (PSMC) of Taiwan | Dholera, Gujarat | ~Rs 91,000 crore | 50,000 wafers/month |
| CG Power & Industrial Pvt Ltd in partnership with Renesas & Stars | Sanand, Gujarat | ~Rs 7,600 crore | 15 million chips/day |
| Tata Semiconductor Assembly and Test Pvt Ltd (TSAT) | Morigaon, Assam | Rs 27,000 crore | 48 million chips/day |
| Kaynes Semicon Pvt Ltd | Sanand, Gujarat | Rs 3,307 crore | 6.33 million chips/day |
| HCL-Foxconn JV | Jewar, Uttar Pradesh | Rs 3,700 crore | 20,000 wafers/month(36 M units/yr) |
| SicSem Private Limited | Bhubaneshwar, Odisha | Rs 2,066 crore | 60 thousand wafers per year; ATMP capacity: 96 millionUnits/year |
| 3D Glass Solutions Inc. | Bhubaneshwar, Odisha | Rs 1,943 Cr | Glass panels: 70Thousand units/year; ATMP : 50 million units/ year |
| CDIL (Continental Device) | Mohali, Punjab | Rs 117 Cr | 158 million units /year |
| ASIP (Advanced System in Package Technologies) | Andhra Pradesh | Rs 468 Cr | 96 million units /year |
Key Stocks to Watch Out For
CG Power and Industrial Solutions – CG Power’s subsidiary, CG Semi, launched India’s first end-to-end OSAT facility in Sanand, Gujarat, with a massive Rs 7,600 crore investment over five years.
The company is partnering with Renesas Electronics and Stars Microelectronics to establish two facilities (G1 and G2) with production capacities of 0.5 million and 14.5 million units per day, respectively. Commercial production is expected to begin in 2026
Kaynes Technology India – Kaynes has committed approximately Rs 3,307 crore for its OSAT facility in Sanand, Gujarat, with 50 percent central government and 20 percent state government support. It aims to produce 6.33 million chips per day.
The company is set to begin commercial-scale deliveries to anchor customer Alpha Omega Semiconductor by October 2025, with mass production starting in January 2026. Additionally, Kaynes announced a Rs 352 crore investment for an advanced electronics manufacturing facility
HCL Technologies – HCL’s joint venture with Foxconn received Union Cabinet approval for a Rs 3,706 crore OSAT facility in Jewar, Uttar Pradesh. The facility will manufacture display driver chips for mobile phones, laptops, and automobiles, with a capacity of 20,000 wafers per month, and is expected to create 3,500 jobs.
Commercial production is targeted for 2027. Other notable players supporting the ecosystem include Moschip Technologies, SPEL Semiconductor, Dixon Technologies, Syrma SGS Technology, Tata Elxi, etc.
India’s semiconductor industry is going through a big change, supported by strong government plans, huge investments, and partnerships with global companies. With projects worth Rs 1.6 lakh crore already approved and key players like Tata Electronics, Micron, CG Power, Kaynes, and HCL-Foxconn leading the way, India is moving closer to becoming a major hub for chip manufacturing. For investors, this sector offers good long-term growth opportunities, so keeping an eye on semiconductor-related stocks could be rewarding.
Written by Satyajeet Mukherjee
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