Mumbai: Tata Group is looking to make a foray into semiconductor manufacturing and already set up a business to seize the opportunity with the advent of 5G, Chairman N Chandrasekaran.
Speaking at the annual general meeting of the IMC Chambar of Commerce and Industry, Tata Sons Chairman N Chandrasekaran said Tata group has already pivoted into a number of new business like electronic manufacturing, 5G network equipment as well as semiconductors, in all probability.
His remarks come days after the $100-billion group announced entry into 5G equipment manufacturing and a string of acquisitions to create the Tata Digital business. Also, the group is looking at the market opportunity of high-tech manufacturing of electronics at $1 trillion.
Semiconductor manufacturing is investment-heavy industry as it involves building chipsets among other things. India doesn’t have any fab manufacturing facility in the private sector even though various consortiums and Vedanta had tried but failed in their endeavors.
Chandrasekaran explained that alterations to the global supply chains, which are heavily dependent on China, in the aftermath of the pandemic and geopolitical changes, will make businesses shift their reliance on other countries and called this a huge opportunity for India, which becomes the second base.
“On rebalancing supply chains, India can significantly benefit from the geopolitical shifts that we are seeing. At the group, we have already set up a business to seize the promise of high-tech manufacturing of electronics, precision manufacturing, assembly and testing and semiconductors in the medium term,” he said while speaking at IMC Chamber of Commerce and Industry’s AGM.
He, however, did not elaborate on the exact plans on this front for the group. Chandrasekaran said he sees four trends emerging in the post-pandemic world — rapid digital acceleration, new approach to supply chains, a re-imagination of growth with environmental sustainability at the core and inclusion of health and wellness concerns by every business.
“The four themes will play into each of our own existing businesses, and they are also leading to brand new initiatives for the Tata Group,” he said.
Tata Digital is building multiple platforms including a consumer offering covering retail, travel, financial services, health and education, which will target both high-frequency buys and also discretionary spending, he said.
Chandrasekaran, who took over the group chairmanship after leading its IT arm TCS, said there is a need to adopt artificial intelligence, cloud and data more aggressively, and Tata Group considers this as a top priority.
Chairman of the group, which devotes nearly all its profits to philanthropic causes, also spoke about the inequities which are being created because of the pandemic and urged for a fast-paced rollout of services to universalize education and healthcare services.