Kaynes SemiCon, a subsidiary of Kaynes Technology, has reiterated its commitment to establishing an advanced electronics manufacturing facility in Hyderabad, Telangana, despite recently securing approval for a project in Gujarat.
Even before the official approval, speculation was widespread that Kaynes SemiCon might shift its investment from Hyderabad to Gujarat, which is rapidly emerging as a key hub for semiconductor investments.
Speaking to Digitimes Asia, CEO Raghu Panicker emphasized that while the Gujarat location is strategically valuable due to the ongoing semiconductor developments in the region, the company remains fully committed to investment plans in Telangana.
Panicker assured that the Gujarat approval would not affect their expansion in Hyderabad. Kaynes recently launched the first phase of its advanced electronics manufacturing facility in Kongarkalan, Hyderabad.
Panicker also stated that the company remains dedicated to fully investing in and making use of the land allocated at the Kongarkalan park.
"The central government, under the Indian Semiconductor Mission (ISM), approved Kaynes Semicon's proposal at Sanand in Gujarat," Panicker explained. "This decision was made based on the belief that creating a semiconductor manufacturing and assembly ecosystem in a single location is essential for making India Semiconductors Mission a success."
Companies such as Tata and Micron are establishing their plants in Gujarat, drawn by the region's rapidly growing semiconductor ecosystem and strong government incentives.
"In the meantime, Kaynes has already inaugurated its first phase of the advanced electronics manufacturing facility in Kongarkalan last month and is committed to fully investing in and utilizing the land allocated at the Kongarkalan park," Panicker continued. "We would like to emphasize that while the nature of the investment has changed, our commitment to Telangana remains unchanged, and employment at the Kongarkalan plant is expected to increase to 3,000."
"Instead of pursuing the semiconductor OSAT project, Kaynes will now focus on advanced electronics manufacturing at the Hyderabad location," Panicker added.
Government approval
This week, the Indian government approved Mysuru-based Kaynes SemiCon to establish an OSAT facility in Sanand, Gujarat. The Rs3,307 crore project, which will be the fourth of its kind in the country, aims to produce 6.3 million chips per day.
The investment will be funded by a mix of contributions: 50 percent or Rs1,653.5 crore from the central government, 20 percent or Rs661.4 crore from the Gujarat state government, and the remaining 30 percent or Rs992.1 crore will be invested by Kaynes Semicon, which secured funds for this project last December.
This approval marks the latest milestone in a series of semiconductor projects sanctioned by the government.
In February 2024, the government had cleared three projects, including a semiconductor fabrication plant by Tata Electronics in Dholera, Gujarat, and another unit in Morigaon, Assam. CG Power is also moving forward with the development of a semiconductor facility in Sanand, Gujarat.
All eyes are now set on Semicon India 2024, where industry leaders eagerly await government announcements on new plans and roadmaps to further advance the country's semiconductor manufacturing ambitions.
