India’s Sahasra Semiconductor to start chip production from September

Sahasra Semiconductor, a company based in Rajasthan, is gearing up to commence the commercial production of India’s first domestically manufactured memory chips, slated for launch in September or early October, according to CEO Varun Manwani. This marks a significant milestone as Sahasra will beat Micron to become the pioneer in chip production within India.

The company has established its semiconductor assembly, testing, and packaging facility in the Bhiwadi district. Initially, it will focus on packaging basic memory products like MicroSD cards and chip-on-board assemblies. As its capabilities grow, it plans to venture into advanced packaging, including internal memory chips.

Sahasra Semiconductor is presently benefiting from the Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS), which offers a 25% financial incentive on capital expenditures. Unlike Micron, which produces its own chips, Sahasra functions as an Outsourced Semiconductor Assembly and Test (OSAT) entity. Its role involves assembling and packaging chips for various brands.

Varun Manwani stated, “We are poised to become the first Indian semiconductor company to initiate chip production. After conducting trial production in March, we anticipate commercial production to commence between September and early October.” The company receives orders from small and medium-sized enterprises to manufacture chips on their behalf and is also exploring export opportunities.

Over a span of five to six years, Sahasra Semiconductor intends to invest Rs 600 crore for chip production and related infrastructure. Currently, it has invested approximately Rs 110 crore in the initial phase of chip assembly and packaging.

Manwani also highlighted that as devices increasingly integrate internal memory, the focus will shift to more advanced packaging methods over the next year and a half. Although the initial focus is on basic chip packaging, the company is eyeing advanced packaging as well.

Apart from chip assembly, Sahasra is also involved in designing its proprietary LED driver ICs. It is considering applying for the semiconductor incentive scheme, wherein the government covers 50% of the project costs.

Sahasra’s supply chain partners hail from countries like Japan, Korea, and Thailand. Leading suppliers include Disco Corp and Kulicke and Soffa.

Looking ahead, the company anticipates generating a revenue of Rs 500 crore from the semiconductor business over the next four to five years, primarily driven by growing domestic demand. Varun Manwani envisions Sahasra as a niche player in the OSAT sector, focusing on various packaging approaches to address market opportunities.

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