Zoho intends to invest $700 million
According to two people with firsthand knowledge of the idea, Indian software company Zoho is preparing to enter the chip business and is looking for incentives from the federal government. One of these sources estimated that the investment plan would cost $700 million.
With its current headquarters located in Tamil Nadu, Zoho was founded in 1996 and competes with companies such as Microsoft and Salesforce by providing software and related services to businesses across 150 countries through subscription.
It is the most recent business to apply to the government for financial incentives in order to establish a chip fabrication facility.A $10 billion package to support the semiconductor industry is in place as part of India's business agenda, which aims to compete with nations like Taiwan in the near future.
According to the two sources, Zoho is planning to produce compound semiconductors, which are created from substitutes for silicon, which is more widely used in chipmaking and have specific commercial uses.
They also said that the suggestion is being examined by the committee at the IT ministry that oversees India's chip projects. According to the second source, the government has asked Zoho for further clarification regarding the clients it plans to work with.
The IT ministry did not answer a request right away, and Zoho declined to comment.Without naming the company, the first source claimed that Zoho had also found a tech partner to assist in starting the business from scratch, with an estimated $700 million investment outlay.
Without giving any further information, Zoho's founder and CEO, Sridhar Vembu, announced in March that the company was contemplating a chip design project in the southern state of Tamil Nadu. It has not previously disclosed its intentions to diversify into the chip manufacturing industry.
According to media sources, Zoho generated over $1 billion in sales in the fiscal year that concluded in March 2023. India approved the construction of three semiconductor plants worth over $15 billion in February. The plants will be built by companies like Tata Group and CG Power, and its goal is to produce and package chips for use in the defense, automotive, and telecommunications industries.
By 2026, the Indian semiconductor market is projected to be valued at $63 billion.
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