Engineering giant CG Power and Industrial Solutions Ltd has achieved a historic breakthrough with its subsidiary, CG Semi Pvt. Ltd., inaugurating India’s first full-service Outsourced Semiconductor Assembly and Test (OSAT) facility in Sanand, Gujarat. The launch marks a significant leap for India’s semiconductor mission, enhancing the nation’s manufacturing self-reliance while expanding its footprint in the global chip market.
Advanced Semiconductor Packaging and Testing Solutions
The Sanand-based OSAT facility positions CG Semi among the country’s pioneering chip packaging and testing providers. It offers both traditional and advanced semiconductor packaging solutions, ensuring high-quality services for domestic as well as global clients. The initiative has been developed with the active support of both central and state governments and in collaboration with leading global semiconductor companies Renesas and Stars Microelectronics.
Major Investment in Chip Manufacturing Facilities
CG Semi has announced an investment of over Rs. 78 billion (approximately USD 870 million) over the next five years to establish two advanced facilities—G1 and G2—in Sanand. The G1 unit, inaugurated on August 28, will achieve a peak capacity of 0.5 million units per day and is equipped with cutting-edge infrastructure including end-to-end assembly, packaging, testing, post-test processes, high-yield machinery, and a level-1 automated Manufacturing Execution System (MES) for full traceability. It also houses in-house laboratories for reliability and failure analysis.
The facility is currently undergoing ISO 9001 and IATF 16949 certifications, with customer qualification runs expected soon. Commercial production is targeted to commence in calendar year 2026.
Scaling Up with G2 Facility
The G2 facility, located just 3 km from G1, is already under construction. Once operational, it will scale up operations to handle 14.5 million units daily by the end of 2028. Together, both facilities are projected to create more than 3,000 direct and indirect jobs, driving industrial growth in Gujarat and strengthening India’s role in global semiconductor manufacturing.
National Milestone in Technological Sovereignty
Speaking at the launch, CG Power Chairman Mr. Vellayan Subbiah described the OSAT facility as a “national milestone” in India’s journey toward technological sovereignty. “Every chip we make here is a step toward India’s self-reliance,” he stated, underscoring the alignment of this project with the Government of India’s Semiconductor Mission.
Market Response
On the Bombay Stock Exchange, CG Power shares closed at Rs. 663.65 on August 28, reflecting a decline of Rs. 7.55 or 1.12 percent. Despite the dip, the long-term outlook remains positive, with the semiconductor expansion expected to strengthen the company’s market position.
