Larsen & Toubro

Larsen & Toubro invests over US$300 million for establishing semiconductor company

Larsen & Toubro plans to invest over US$300 million to establish a new fabless semiconductor company.

The investment of Larsen & Toubro will be distributed across three years to set up a fabless chip company. Fabless companies concentrate on creating and purchasing chips while outsourcing manufacturing to specialized facilities.

Larsen & Toubro Collaboration with IBM

L&T has also collaborated with IBM to enhance processor technology. The goal of the partnership is on creating powerful, secure, and expandable processors for edge devices and hybrid cloud environments. 

Notably, L&T plays an important role in contributing to the Indian economy in the semiconductor sector, making it a significant player in the semiconductor industry globally.

Currently, L&T Semiconductor Technologies has employed around 250 people, majorly employing chip designers. The company is looking for assistance from the government in the form of subsidies or rewards for designing chips, but it has made it clear that it won't be seeking additional financial help from external sources, except for within the L&T group.

Semiconductors have become an essential commodity globally, particularly with the looming threat of the US-China trade conflict escalating the cost of importing chips. 

Larsen & Toubro’s Investment

L&T's spending is relatively small when compared to the expenditures of major chip manufacturers that design their own chips, like Nvidia Corp. and Advanced Micro Devices Inc. The Indian company focuses on developing such as power chips, radio-frequency semiconductors and mixed-signal integrated circuits, instead of concentrating on products like graphics processing units that support artificial intelligence.