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L&T Semiconductor Technologies, a fabless chip company, plans to start manufacturing semiconductor products designed by the company within the next two years, according to CEO Sandeep Kumar. In an interview with PTI, Kumar revealed that the company plans to set up its own chip manufacturing factory once it achieves revenue thresholds of $50 million to $1 billion across various semiconductor technologies.
The company is actively building a team to manage the designs of 15 different semiconductor products simultaneously, and is already halfway through this process. Kumar said they will reach full production capacity within the next six months and begin product design by the end of 2024. These designs are expected to enter production by 2026.
As a fabless semiconductor company, L&T is focused on reducing India’s dependence on foreign semiconductor manufacturers. Mr. Kumar highlighted the risks of dependence on external suppliers. He stressed that if foreign countries stop sharing technology, the domestic semiconductor sector could become dysfunctional. By producing indigenous products, India can maintain its dominance in global markets and secure strategic value.
L&T Semiconductor has already begun building strategic partnerships, including a recent agreement with IBM to collaborate on research and development of advanced processors. These processors have the potential to be used in a variety of areas, including mobility, industrial electronics, and cloud systems. Kumar noted that the chips developed by L&T will initially be produced in foundries outside India, but the company may consider producing them domestically if the cost is feasible.
“Fabs above 28 nanometers are about $10 billion. To turn this into a profitable business, we need about $1 billion in annual sales from that fab. “You need to have a high degree of confidence before embarking on setting up a 28-nanometer silicon factory,” he said. For small, cutting-edge chips like the 2-5 nanometer node, Kumar estimates the cost at $100 billion, with a sales target of $10 billion.
Indian semiconductor companies are partnering with academic institutions to fill the prevailing skills gap as the demand for talent in the sector is expected to reach $80.3 billion by 2028.
According to a report by TeamLease Degree Apprenticeship, the Indian semiconductor industry faces a shortage of 250,000 to 300,000 professionals in various fields such as research and development (R&D), manufacturing, design and advanced packaging by 2027. is expected to face. read more
