Strategic Venture Poised to Meet Surging Demand and Support India’s Self-Sufficiency in Semiconductor Manufacturing
KUALA LUMPUR, Malaysia, Feb. 27, 2025 (GLOBE NEWSWIRE) -- Accelerating India’s semiconductor transformation and solidifying its position in the industry’s supply chain, VCI Global Limited (NASDAQ: VCIG) (“VCI Global” or the “Company”) is establishing India’s first semiconductor wire manufacturing plant in partnership with Kinesis Manufacturing Solutions Sdn Bhd (“Kinesis”). This strategic initiative aligns with and supports the Indian government’s effort to build a self-sustained semiconductor ecosystem.
The VCI Global-Kinesis plant will focus on producing semiconductor bonding wires, a crucial component in chip manufacturing. The 25,000-square-foot facility will be located in Chennai, with an initial investment of US$3.5 million. Operations are set to begin in the third quarter of 2025 with a single production line. By reaching mass production within the same quarter, the plant is projected to generate up to US$50 million, resulting in a return on investment (ROI) within 12 months. There are plans to expand to four production lines in the near future, aiming for an annual revenue of approximately US$200 million.
As India advances its goal of becoming a global semiconductor powerhouse and aligns its strategies with the Smart Cities Mission, the development of large-scale fabrication and packaging facilities is driving a surge in demand for semiconductor materials. This rising demand is reflected in market projections, with IMARC estimating that India’s semiconductor materials market will reach US$8.1 billion by 2033, growing at a compound annual growth rate (CAGR) of 5.22% from 2025 to 2033. This growth is further fueled by foreign direct investment (FDI) and government incentives promoting supply chain localization. In response, VCI Global and Kinesis are strategically positioned to establish India’s first semiconductor wire plant, reducing reliance on imports and strengthening the supply chain for critical infrastructure.
Prominent Semiconductor Expansions in India:
- Lam Research Corporation: Investing approximately US$1.2 billion to establish a manufacturing facility in Karnataka, located in the southwestern region of India.
- Micron Technology Inc: Establishing a semiconductor assembly and test facility in Sanand, Gujarat, with an investment of US$2.75 billion.
- Crompton Greaves Limited: Collaborating with Renesas Electronics America Inc. and Star Microelectronics (Thailand) Public Co Ltd to set up an outsourced semiconductor assembly and test (OSAT) unit, with a total investment of approximately US$877 million.
- Powerchip Semiconductor Manufacturing Corporation: Partnership with Tata Electronic Private Limited to establish a semiconductor fabrication facility in Dholera Special Investment Region (SIR). This project is valued at approximately USD11 billion, with production slated to commence by 2026.
This joint venture will be majority-owned by VCI Global, with a 51% stake, while Kinesis will hold the remaining 49% stake. The venture will be led by Mr. Loh Beng Siew, a key member of the Kinesis team, who previously established Ultra Clean Technology’s first factory in Malaysia and led AllianceCorp Manufacturing Sdn Bhd to become Malaysia’s first manufacturer of weldments for front-end semiconductor equipment. Backed by the Kinesis team’s exceptional track record in greenfield and brownfield semiconductor manufacturing projects, the leadership is well-positioned to drive the initiative’s success.
“With this strategic venture, VCI Global aims to become a leading supplier in India, providing a critical component for semiconductor packaging and chip manufacturing. Establishing the country’s first semiconductor wire plant secures a high-margin revenue stream and aligns us with the world’s top semiconductor players. As the Indian government drives domestic semiconductor manufacturing and major players expand into the region, we are seizing a rare opportunity to lead a vital niche in the global supply chain,” said Dato’ Victor Hoo, Group Executive Chairman and Chief Executive Officer of VCI Global.
About VCI Global Limited
VCI Global is a diversified global holding company with a strategic focus on AI & Robotics, Fintech, Cybersecurity, Renewable Energy, and Capital Market Consultancy. With a strong presence in Asia, Europe, and the United States, VCI Global is committed to driving technological innovation, sustainable growth, and financial excellence across multiple industries.
About Kinesis Manufacturing Solutions Sdn Bhd
Kinesis specializes in precision manufacturing and semiconductor fabrication support, with proven track record of building and optimizing semiconductor factories and supply chains. Leveraging deep industry expertise and strong execution capabilities, Kinesis is a trusted player for delivering high-quality, scalable solutions that drive innovation and efficiency in semiconductor production.