Jewar: HCL Group, the parent firm of India’s third-largest tech services company HCLTech, aims to supply chips for a quarter of all of India’s displays within as soon as two years, chairperson of the group Roshni Nadar-Malhotra said on Saturday.
The top executive, who also happens to be the only woman at the helm of one of India’s six large-cap IT services firms, was speaking at the inauguration of the company’s joint-venture chip assembly plant for displays in Jewar, Uttar Pradesh.
“It’s too early to discuss client names, but there is ample demand, and India has a huge market. We’ll roll out the first commercial display chip from our plant in 2028, and look to scale up to our peak capacity of 36 million chips per month very soon. About 60-70% of our production will be solely for the domestic market, where we believe there’s ample demand—in fact, this supply will cater to 25% of all of India’s display chip demand,” Nadar-Malhotra said.
The outsourced semiconductor assembly and test (Osat) facility was approved for incentives under the Ministry of Electronics and IT (Meity)’s India Semiconductor Mission (ISM) in May last year, at a net investment outlay of ₹3,700 crore. Out of this investment, Centre and state government incentives will fund “around 65-70% of the project cost”, the executive added.
To be sure, the venture will operate independently of HCL Technologies as a privately held joint venture, India Chip Private Ltd, with Taiwan-headquartered global contract manufacturer Foxconn. HCL Corp. holds a 60% stake in the joint venture, with Foxconn holding the remaining 40%.
HCL Corp. is a part of HCL Group, and was founded by billionaire Shiv Nadar. He also set-up HCL Technologies Ltd. Nadar’s daughter, Roshni, also serves as the chairperson of HCL Technologies Limited.
Employment generator
Nadar-Malhotra highlighted that while HCLTech has previously worked on semiconductor design as part of its engineering, research and development (ER&D) vertical, the Osat venture may work independently, and clear synergies between the two ventures of the group have not been demarcated yet.
She, however, said that the assembly plant will generate employment and not be fully automated despite heavy reliance on autonomous machining for chip cutting and other technical tasks.
“The venture will need us to hire 800 engineers specially skilled in semiconductor engineering, which is a very different kind of skill from the chip designing that we’ve done at HCLTech before. These aren’t low-value jobs, but actual high-value engineers that will create proprietary chip designs for usage across a wide range of display panels. Eventually, we’ll build an ecosystem of residences and supply chain partners here—it’ll be great if they come and set-up where we are,” she said.
India Chip Private Limited will cater squarely for semiconductor chips used in displays, and was announced a day after the governments of India and the US jointly signed to Pax Silica—a trusted supply chain programme for rare earth metals and their impact on semiconductors, electronics and other associated sectors.
A total of $18 billion was invested under Meity’s ISM’s first tranche, with a total of 10 projects being approved under the scheme. HCL Group will import the lithography equipment to be used for creating the chips and the pure silicon wafers on which the chips will be made, at least in the immediate future.
However, the HCL-Foxconn joint venture is not an outright display chip fabrication plant, and will depend on other fabs higher up in the value chain for the time being.
Returning to roots?
Nadar-Malhotra also didn’t say if the group, once one of India’s earliest indigenous personal computer makers, will seek to expand its presence in India’s electronics hardware industry once again.
“There are great government subsidies and incentives in the electronics sector, but for now, we find the semiconductor market to be a great opportunity, and we’ll validate our work once we start commercial supplies in the next two years. That’s where we’re at today, and that’s where we’re focusing on,” she added.
HCL’s group subsidiary, HCL Infosystems, was in charge of the company’s hardware business, which was one of the earliest brands of PCs to be sold commercially to consumers in India. The group wound up its hardware business in 2013.