Fabless chip startup backed by multi-billion Indian company wants to build a $10bn fab in India before 2027

• Indian government is expected to contribute a staggering 90% of the cost
• The announcement comes as fab demands is heating up on the back AI explosive growth
• Construction of these fabs is a very long process and always lags demand, sometimes by years

L&T Semiconductor Technologies (LTSCT), a fabless chip startup backed by Indian engineering firm Larsen & Toubro, is planning to build a $10 billion wafer fabrication facility in India.

A report by eeNews Analog claims the ambitious plan hinges on LTSCT achieving $1 billion in annual revenue by the 2026–2027 fiscal year.

Founded in 2023 as a wholly owned subsidiary of Larsen & Toubro, LTSCT was created to design a range of semiconductor components, including MEMS sensors, analog and mixed-signal ICs, RF chips, and smart power devices. While the company hasn’t yet started shipping chips, its CEO, Sandeep Kumar, expects commercial production to begin in the second half of 2025.

Increasing ABF production by 50%

eeNews Analog says Kumar told Business Standard, “A fab plant will require an investment of over US$10 billion. Even with subsidies, it will mean an investment of US$1 billion.” He noted the company’s fab plans would be triggered only if it achieves $1 billion in annual revenue by the 2026–2027 fiscal year.

The company is banking on India’s semiconductor push, which includes a $10 billion incentive program launched in 2021.

The Indian government is expected to contribute up to 90% of the cost of the proposed fab - a level of support that Kumar acknowledges is unusually high by global standards. LTSCT isn’t expected to seek outside funding beyond that.

eeNews Analog noted that LTSCT’s long-term strategy would see it transition from a fabless designer to an integrated device manufacturer (IDM).

The company has already secured more than $300 million in funding from Larsen & Toubro to support its design efforts, with plans to develop 15 chip products by 2027.

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