Innolux expects mass production of LCD panels in India two years after approval

Taiwan-based Innolux, a technology partner with India-based Vedanta on TFT-LCD panels, said its collaboration with Vedanta will begin mass production of display panels in two years after approval and is likely to reach break-even two years after operation.

James Yang, Innolux president and COO, told PTI that if the Vedanta-Innolux collaboration on TFT-LCD panels gets approval from the Indian government under the INR760 billion semiconductor and display manufacturing incentives, the company expects completion of phase one construction and begin mass production in 18-24 months, with the phase two taking another 6-9 months.

Innolux plans to assist Vedanta in providing technology know-how regarding TFT-LCD without involvement in the operation of the display fab, which may cost US$30-40 billion to build. Innolux said in a corporate filing in February 2023 that the company had entered into a technology transfer agreement with Vedanta Group and its subsidiary Vedanta Displays Limited to help establish TFT-LCD panel front-end and back-end production lines in India. Without offering the exact number, Innolux expects the transfer fee to be tens of billions of NTD, reports DIGITIMES Asia. The 8.6G LCD manufacturing facility is reportedly to have a monthly production capacity of 22,50x2,600mm glass substrates.

India announced the INR760 billion incentive scheme for semiconductor and display fabs manufacturing in December 2021 and announced the applications for the scheme in February 2022, including the application proposed by Vedanta on display panels. After about two years, Vedanta and Innolux are still waiting for approval.

Yang told PTI that if the project can enter mass production by 2026, it will likely break even by 202. The total return on investment can be realized in 13 years. He added that the project is expected to generate 5,000 jobs, including 2,000 for engineers. 300 engineers are expected to be sent by Innolux from Taiwan to India.

Although the display industry leaders are investing and expanding the production of OLED panels, Yang said OLED is essentially a derivative of LCD technology. LCD is expected to continue to dominate the display segment with nearly 90% of the market by at least 2030.

Source: IDC, February 2024