MC Exclusive | Kaynes Semicon targets 1st commercial chip from Gujarat unit by Mar, eyes $250-mn revenue: CEO

Raghu Panicker- CEO- Kaynes Semiconductor

Kaynes Semicon, the chip-making arm of Kaynes Technology, aims to deliver its first commercial product from its upcoming outsourced semiconductor assembly and test (OSAT) facility in Sanand, Gujarat, in March 2025.

The company, which has three key partnerships, expects to generate revenue this fiscal year and reach $250 million in sales within four years from 10-12 customers, Kaynes Semicon chief executive Raghu Panicker said in an interview after the company’s Rs 3,300-crore facility got government approval under the Rs 76,000-crore India Semiconductor Mission on September 2.

“This year, we will have a small revenue of about $10 million. We are targeting nearly $75 million in the second year, which we want to double in the third year. In the first year, we want to go up to $250 million in revenues. I want to be close to 25 to 30 percent of my revenue (Kaynes Semicon) contribution to Kaynes technology,” Panicker said. "We are targeting to have 13 chip assembly and test lines over the next 1.5-2 years with a volume of 1 billion chips annually."

The three technology partners that Kaynes Semicon has teamed up with are Globetronics from Malaysia, Aptos Tech from Taiwan, and AOI from Japan.

In June 2023, the Union Cabinet approved the first proposal for setting up a semiconductor unit in Sanand. In February 2024, three more semiconductor units were approved. Tata Electronics is setting up a semiconductor fab in Dholera, Gujarat, and one in Morigaon, Assam. CG Power is setting up a unit in Sanand, Gujarat.

Union minister Ashwini Vaishnaw said on September 2 that construction of all four semiconductor units is progressing rapidly, and a robust semiconductor ecosystem is emerging near them. These four units will bring an investment of almost Rs 1.5 lakh crore. Their cumulative capacity is about 7 crore chips a day.

Kaynes, which had earlier planned to set up a facility in Telangana, bought land for its Sanand facility in March. It has started structural and soil tests and has initiated work on designing the facility.

“We have aligned with the equipment that we have to buy. From tomorrow onwards, we'll start placing the orders. We will get the approval letter from MeitY today. We will do the ground-breaking very soon. We have started work under our 100-day plan, which we are executing,” Panicker said.

Kaynes has formally signed a deal with Lightspeed Photonics, a Singapore-based fabless system development company, for its Gujarat unit. The executive said the other two customers are from Taiwan and the US. “In the initial phase, three to four production lines will come up within this year. All our partners are coming to the Semicon event. So we'll sit down and do the next level of planning,” Panicker said.

The company has hired around 30 key executives for the unit, including 15 expats from the Philippines, Malaysia, and Taiwan. By March 2025, it plans to hire around 450 employees across functions for the Gujarat facility.

Kaynes has signed agreements with eight universities to ensure its facility has relevant semi-skilled talent. “Three universities are in Gujarat, Odisha, IIT Hyderabad and Mumbai. We have already offered jobs to semi-skilled workers."

Kaynes Technologies inaugurated an advanced electronics unit near Hyderabad on August 23 to manufacture smart meters and other electronics products.

Panicker said that the Hyderabad facility is part of the company's expansion plan and will help it achieve Rs 500 crore in revenues just from the smart meter segment. "We have a large backlog of orders we will do this year. Brightgrid will be our first customer, but there will be multiple such customers, and this line is primarily dedicated to the smart meter," he said.