MUMBAI (CU)_India’s largest mining and non-ferrous metals company is looking to enter the chip manufacturing industry in partnership with a Taiwanese multinational electronics manufacturer. Vedanta Group, founded in Mumbai and now headquartered in London, has already drawn up a multi-billion dollar plan to this end, hoping to begin manufacturing by 2024.
The company, owned by Anil Agarwal, is looking to invest a whopping $8.4 billion in a chip manufacturing unit, in partnership with Foxconn Technology Group, based in Taipei, the Economic Times reported. Citing a top executive of the company, the newspaper also revealed that Vedanta has already applied for a government incentive scheme in this regard. “The total project cost for 28 nanometres is around $7-$8 billion,” Akarsh Hebbar, the global managing director of the company’s display and semiconductor business, told ET. “We want to make sure that the plant comes on board by 2024. We are looking at the site, equity structure and more. Foxconn is investing around $118 -$120 million.”
He further noted that Vedanta is eyeing the mobile phone and consumer electronics space for the 28 nm chips that will be manufactured, with a significant focus on the domestic market. “We want to focus on the domestic market and want to sell around 70-80% locally and export value can come in accordingly depending on the cycle to around 30-20%,” Hebbar said. “We are very hopeful that the government approval will come in the next 3-4 months.”
According to Vedanta’s top executive, although Foxconn has no prior experience in manufacturing semiconductors, it was considered a perfect partner for this project owing to its global footprint in electronics manufacturing, and is believed to possess the “right technology” as a result of its vast understanding of the global electronics industry. “It is a $200 billion market cap company, they themselves use $30-$42 billion worth of semiconductors chips and they have the right technology,” Hebbar noted. “They are no stranger to semiconductor chips. Foxconn is yet to manufacture the 28 nanometre chips, they have started it in 7-8 factories globally but the experience they have is good. Foxconn has the right engineers to build this.”
