- Key Highlights from the Announcement
- Why Stock Reacted Positively
- Summary
- Disclaimer
Shares of CG Power and Industrial Solutions Limited gained more than 4% today after its subsidiary, CG Semi Private Limited, announced the launch of one of India’s first full-service Outsourced Semiconductor Assembly and Test (OSAT) facilities in Sanand, Gujarat. The development marks a significant step toward India’s semiconductor self-reliance and has strengthened investor confidence in the company’s long-term growth prospects.
Key Highlights from the Announcement
Here are some of key highlights from the press release of CG Power:
Launch of OSAT Facility
CG Power has inaugurated one of India’s first OSAT facilities, positioning itself as an early entrant in providing end-to-end chip assembly, packaging, and testing solutions. This directly supports the government’s Atmanirbhar Bharat initiative to reduce reliance on imported semiconductors.
Scale and Investment
Backed by central and state government support, the company is investing about ₹7,600 crore (~USD 870 million) over the next five years to develop two state-of-the-art facilities:
- G1 Facility: Inaugurated today with a peak capacity of around 0.5 million units per day. Commercial production is expected to begin in 2026.
- G2 Facility: Under construction and scheduled for completion by the end of 2026, with a much larger capacity of approximately 14.5 million units per day.
Together, the facilities are expected to create more than 5,000 direct and indirect jobs.
Global Partnerships
CG Semi is supported by international leaders Renesas Electronics (Japan) and Stars Microelectronics (Thailand). These partnerships bring advanced technology and expertise, further strengthening execution capabilities.
Why Stock Reacted Positively
- Strong Government Support: Central and state backing makes execution risk lower and adds confidence.
- High Entry Barrier Industry: OSAT requires scale, tech, and experience; limited players in India to match the scale.
- Global Demand Tailwind: Chip shortages plus India’s growing electronics/auto/IoT industries create strong domestic & export demand.
- Strategic Partnerships: With Renesas & Stars, CG gains access to advanced packaging and testing know-how.
- Narrative Boost: “India’s first full-service OSAT facility” is a headline-grabbing, long-term growth story that investors reward.
Summary
Commenting on the development, Vellayan Subbiah, Chairman of CG Power, described the facility as a “national milestone,” underlining that every chip manufactured will be a step towards India’s technological sovereignty. In summary, the sharp rise in CG Power’s stock reflects the market’s recognition that the company is emerging as one of the first serious players in India’s semiconductor ecosystem, with potential for long-term structural growth.
Disclaimer
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