Suchi Semicon starts chip factory without center incentives, plans $100 million investment over three years

Surat, Dec 15 (PTI) Gujarat-based Suchi Semicon will start producing semiconductors without incentives from the Center and plans to invest $100 million over three years, a company official said. said on Sunday.

Ashok Mehta, chairman of Suchi Group and founder of Suchi Semicon, said his company has applied for incentives from the center under SPECS (Electronic Components and Semiconductor Manufacturing Promotion Scheme) and the Indian Semiconductor Mission, which would require it to reduce production. He said he had no intention of putting it on hold. of incentives.

“We have a fully proven business plan. Our business plan is not primarily aimed at incentives. We have set up a factory to do business. Center approval will be obtained when we meet their requirements. We made $100 million (approximately). INR840 million over three years,” Mehta said.

He said the state government had approved 20% incentive for the factory.

“When there was a shortage of semiconductors due to the coronavirus pandemic, Prime Minister Narendra Modi asked us to turn the crisis into an opportunity. That’s when we decided to enter the semiconductor business. We have decided to set up a factory.’We are conducting research in collaboration with industry experts,” Mehta said.

He is also the founder of the textile company Suchi Industries.

“We have clients who have already submitted their requirements. Most of our production is for overseas clients. We started prototyping some time ago and our components are being tested by clients.” Mehta said.

He said the company used some of the money from its textile business and raised funds from friends and family.

“We have also tied up with Punjab National Bank for a credit facility. Our investment plan also includes guaranteed incentives from the Center based on performance,” Mehta said.

Suchi Semicon co-founder Shetal Mehta said commercial shipments of semiconductors will begin in the first quarter of next year.

“Commercial shipments begin after testing is complete. Some applications in which our components are used take two weeks for testing and approval, while others take three to four months. Commercial shipments are scheduled to begin in the first quarter,” Shetal said.

He said the company plans to enter power semiconductors in the second phase of its expansion, which could happen as early as next financial year.

Regarding the approval of the centre, Sheetal said the company is at an advanced stage of discussions with its technology partners and expects to sign a memorandum of understanding soon.

“The government wants us to have a complete backup plan to avoid any negative impact on our business.The technology partnership will further improve our business profile.If we can get a technology partner, the Center will We will also approve our factory for incentives based on India’s Semiconductor Mission,” Sheetal said.

He said the center has two conditions: one is a technology partner and the other is experience in this field.

“We have started production at the factory. I think the Center will also consider our performance as one of the criteria for approving incentives,” Sheetal said.

He said the company has a team of 60 people, some of whom have extensive experience in the semiconductor field.

“We are also training more employees before scaling up production. Semiconductors are a new-age business, and the future is semiconductors across different areas. In an electric car, you’re exposed to about 600 semiconductors.”That’s in the range of 5,500 semiconductors. As the demand for technology increases, the demand for semiconductors will also increase many times over,” Sheetal said.

He said that through the textile business, Suchi Group has several connections across industries and people in the technology field are starting to have confidence in India’s semiconductor production capabilities.