P Raja Manickam, a veteran of the semiconductor industry and former CEO of Tata Electronics OSAT, has launched a new fabless semiconductor startup named iVP Semi. This venture aims to localize design and chip production, addressing a critical gap in India’s semiconductor ecosystem.
Manickam emphasized the need for product companies in India that can integrate chip design and manufacturing capabilities. While India has strong chip design firms and with Tata Electronics establishing a semiconductor fabrication facility, the country lacks major product companies in this space. iVP Semi seeks to bridge this gap by focusing on building and selling semiconductor products.
The launch of iVP Semi comes at a time when the semiconductor industry in India is poised for significant growth. In March, Tata Electronics commenced work on a massive ₹91,000 crore semiconductor fabrication facility at the Dholera Special Investment Region in Gujarat. Additionally, Tata Electronics is setting up a ₹27,000 crore Outsourced Semiconductor Assembly and Test (OSAT) facility in Morigaon, Assam. The Murugappa Group’s CG Power and Industrial Solutions also started construction on a ₹7,000 crore OSAT facility in Gujarat.
iVP Semi plans to buy wafers from Taiwan, Japan, and Korea, and will handle the packaging and testing in India once Tata and CG Power’s facilities become operational. By doing so, iVP Semi aims to create a robust local supply chain for semiconductor production.
The semiconductor manufacturing process involves several stages, including design, fabrication, OSAT, and electronic design automation. Fabless companies like iVP Semi focus on the design stage, outsourcing the manufacturing to specialized foundries. This model is similar to that of industry giants like Qualcomm and NVIDIA.
Initially, iVP Semi will target the power sector, including renewable energy, battery storage, and transmission needs. As smart grids become more prevalent, the demand for advanced semiconductor solutions in the power sector is expected to grow, with a total addressable market estimated at $3.5 billion.
To support its operations, iVP Semi has raised $5 million in a pre-series A funding round. The company is setting up chip design centers in Chennai and Bengaluru, and plans to license product IP from Taiwan, Japan, and the US. A 20,000 sq ft production test facility is being established in Chennai in collaboration with the Tamil Nadu government, with a second facility planned in South India.
With an asset-light model, iVP Semi aims to employ around 250-300 people over the next three years. The company is targeting revenue of $70-100 million within the next 3-4 years, positioning itself as a significant player in India’s burgeoning semiconductor industry.