Chennai-based Zoho Corp. has set its sights on expanding its technological footprint by venturing into semiconductor manufacturing in India. The company announced on Thursday that it has applied for a license to establish a compound semiconductor fabrication plant, or fab, with an earmarked investment of $200 million.
Speaking at Zoho’s annual event in Texas, USA, Sridhar Vembu, co-founder and chief executive of Zoho Corp., confirmed the strategic move, highlighting the potential economic impact and technological advancement the project could bring. “We have applied for the license and are awaiting government clearance. We will make a formal announcement once we receive the approvals,” Vembu stated.
The proposed semiconductor fab is expected to attract approximately $600 million in net investment, involving a technology partnership to facilitate its development. Zoho aims to introduce Silicon carbide (SiC) chip manufacturing to Tamil Nadu, with plans to license the technology from Scotland-based Clas-SiC, according to industry insiders familiar with the matter.
The initiative falls under the government’s semiconductor and display manufacturing scheme, modified in June 2023 to promote indigenous production and reduce dependency on imports. Under this scheme, companies can receive fiscal incentives equivalent to 50% of their capital expenditure, provided they meet specified investment thresholds.
Silicon carbide compound chips, the intended product of Zoho’s fab, are crucial for various industrial applications, including electric vehicles (EVs), reflecting the company’s strategic alignment with India’s clean energy goals.
Zoho’s move into semiconductor manufacturing aligns with its broader strategy to enhance local manufacturing capabilities and contribute to the development of advanced technologies in India. The company’s application marks it as the third entity after SiCSem and RIR Power Electronics to seek a license for semiconductor manufacturing in the country.
Zoho, known for its robust suite of enterprise software solutions, including CRM systems, aims to leverage its technological prowess and market insights to establish a strong foothold in the semiconductor sector. The development underscores Zoho’s commitment to innovation and sustainable growth in the Indian and global markets.
