Cyient Arm Eyes SCL Mohali Revamp Deal With Tech Proposal

(MENAFN- Live Mint)

Months after separating its semiconductor business into a wholly-owned subsidiary, IT solutions provider Cyient Ltd is trying to win a big government project to upgrade the state-owned chip facility Semi-Conductor Laboratory (SCL) in Mohali.

The company's subsidiary Cyient Semiconductors has submitted a proposal to the government offering advanced technology that can help SCL improve its existing capabilities and make more chips in the future.

“This improvement will exactly make it (SCL) suited for us to do chip tapeouts (from SCL). It's a good fit to the general capabilities that we have and we require for applications such as power management chips, automotive chips, and chips in wireless connectivity," Jan Crols, chief technology officer of Cyient Semiconductor, told Mint.

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The company is also looking to loop in a large semiconductor company as a partner to help with advanced technology for the SCL Mohali project.

While Crols did not disclose the revenue opportunity if Cyient's bid for upgrading technology gets selected for SCL, industry executives said it could be about ₹500-1,000 crore out of the total ₹4,000 crore tender. Cyient will be competing with Tata Semiconductor and Tower Semiconductor, which are also in the race to revamp the existing unit at SCL, Mohali.

A tapeout is when the chip design is 100% complete, and the design files are sent to the semiconductor foundry to be manufactured. Simply put, Cyient Semiconductor designs custom chips tailored for specific applications in sectors like automotive, industrial, data centres, and medical. In the absence of any chip manufacturing facility in the country, the designed chips are then manufactured outside the country in facilities of chip manufacturers such as Global Foundries.

To be sure, Cyient Semiconductors is also a channel partner of GlobalFoundries and provides companies with fabrication access, technical consultation, design enablement, assembly, testing and other value-added services.

Revamp overdue

When asked if utilizing SCL for tapeouts and manufacturing would be cost-effective, Crols said,“I do not see why this could not be cost-competitive within India. But cost is not the only factor, the (SCL facility) needs to have improved features at a good price."

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The government is improving the decades-old SCL Mohali facility. Among the bidders, five companies-Cyient Semiconductors, Applied Materials, ARAK Tech, Tower and Tata Semiconductor-have qualified in the technical round. Tower and Tata are the common bidders in all three packages.

The project includes identifying the upgrades needed to improve SCL's existing 180-nanometer (nm) fabrication line. This involves improving technology, integrating advanced equipment to boost production capacity, and replacing decades-old machinery that requires frequent repair and maintenance.

Cyient's bid is restricted to providing advanced technology for the 180-nm line. This includes supplying technology intellectual properties (IPs) with Process Design Kits (PDKs). A PDK is like a toolkit that chip designers use to build and test their chip designs. It has all the rules, files, and models needed to ensure that the chip works correctly with the machines that will make it.

The 180-nm process is an old chip-making technology. It is still used to make chips for satellites, space and defence systems, medical devices, micro-controllers, power management, etc. In chip-making, nanometers measure the size of tiny parts like transistors and the spaces between them on a chip. Smaller nanometers mean smaller, faster, and more power-efficient chips.

All-round support

On Tuesday, minister for electronics and IT Ashwini Vaishnaw said,“The SCL modernization programme is progressing very well. There are two components to the modernization plan. The first is to increase the production level. The second is to have SCL as a facility, which is available for researchers and startups to test and do tapeouts of their products."

Vaishnaw added that if any company goes to a regular commercial facility, they would need a minimum production volume for taping out.“So we definitely need one facility in the country where any new product pitches designed by students, researchers and startups can be taped out and validated, then it can be taken for commercial production," he said.

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Besides submitting bids to improve SCL, Cyient has also proposed to become a go-to-market partner for SCL.“We have had conversations with SCL (also) on how we can be a go-to-market partner with them. We have known the landscape externally for a very long time. Putting a fab is fine, but you also have to fill the fab, and that is where our design expertise and access to market come in," said P.N.S.V. Narasimhan, president and head of corporate affairs at Cyient.

When asked if SCL's 180 nm node would match Cyient's work, Crols said,“Yes, we also use 180 nm technology but with extra features such as high voltage capabilities. For power management and automotive applications, 180 nm is important for us and many other companies."

In the April-June quarter, Cyient reported a 6.9% year-on-year (y-o-y) increase in net profit to ₹153.8 crore. The company's revenue from operations rose 5% to ₹1,781.5 crore.

In April, Cyient announced the launch of its fully owned semiconductor subsidiary, Cyient Semiconductors.

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