Cyient has allocated $100 million towards its newly established semiconductor business. The Hyderabad-based company also plans to raise additional capital from external investors by September and is in the process of appointing merchant bankers for the initiative.
While the exact fundraising target was not disclosed, Krishna Bodanapu, executive vice chairman and managing director (MD), stated that the capital would be directed towards research and development (R&D). He added that the board has already approved the $100 million investment and that external funding would further support the company’s growth ambitions.
Further, the new business is planning offer customised silicon chip solutions for a wide range of sectors, including electric vehicles and power distribution companies requiring smart metres. The company sees strong demand for such solutions and aims to drive intellectual property creation while leveraging evolving geopolitical dynamics as a growth catalyst.
Cyient, which has already delivered 40 custom chips to clients, carved out the semiconductor unit as a wholly owned subsidiary to enhance focus and tap emerging opportunities. Suman Narayan, chief executive officer (CEO) of the new unit, stated that all 400 existing Cyient employees working on semiconductors will transition to the new entity. He emphasised that the focus will be on quality over quantity in hiring, with more than 60 per cent of the cost structure tied to talent.
Furthermore, the company will steer clear of advanced, lower nanometre chips dominated by firms like Nvidia, instead focusing on mature, higher nanometre technology. The capital infusion, as per the company, will be key to making the right investments in this area.
