India-based fabless startup IndieSemiC is betting that its new OSAT partnership with Kaynes Semicon can help it move from RF modules into vertically integrated chip products. However, the company acknowledged that the headline volume tied to the collaboration is still based on expected customer adoption rather than firm orders.
In an interview with DIGITIMES Asia, Nikul Shah, founder and CEO of IndieSemiC, said the company's projected deployment of 5 million to 10 million chips over the coming years is based on expected adoption from its existing module customer base, which he expects will provide an early market for its planned low-cost microcontroller products.
"We currently don't have any of the agreements from any of the customers," Shah said. "But we already have almost 80 to 100 customers with us" through the company's module division, which offers RF modules based on BLE, Wi-Fi, LoRa, and cellular technologies.
Based on that installed base, he expects existing customers to adopt the chip once samples are supplied.
Moving beyond modules
Shah framed the strategy around a gap in India's market for an "affordable chip," specifically general-purpose microcontrollers (MCUs). He noted that while other Indian players focus on application-specific chips (ASICs) with higher costs, IndieSemiC targets the mass market where low cost is critical for customer margins.
The company sees primary volume drivers in smart meters, consumer electronics, keyboards, and mice. Shah highlighted that Indian hardware companies are increasingly moving R&D in-house, creating a demand for "Make in India" chips and IoT modules.
Among existing customers, internal research suggests 30% to 40% have indicated willingness to adopt the MCU, though Shah considers 25% a "safer side" estimate for initial acceptance.
Domestic backend, external foundry risk
The Kaynes partnership is central to IndieSemiC's attempt to localize more of its backend flow, even as wafer fabrication remains offshore.
Shah said geopolitical risk around wafer sourcing remains one of the company's main concerns, given the concentration of foundry capacity in Taiwan and the limited number of viable alternatives in the US, Singapore, and Malaysia. He described the US and Singapore foundry options as costlier, while China remains cheaper.
"Most of the risk… is the foundry risk," Shah said, noting that if geopolitical tensions disrupt overseas wafer supply, it could become difficult for Indian chip companies to secure wafers even if local design and OSAT capabilities are improving.
For that reason, he said the company is trying to localize as much of the post-fab workflow as possible. Kaynes Semicon's OSAT facility in Sanand, Gujarat, stood out largely because of its proximity to IndieSemiC's base in Ahmedabad.
"The Kaynes plant is just an hour away from my office," Shah said. "If any failure comes, then my resource can immediately go there, and they can solve that."
That proximity matters, he said, as production volumes rise, and process issues become harder to manage remotely. Shah also cited Kaynes' existing reputation and the fact that some IndieSemiC modules are already assembled through Kaynes Technology as reasons for the initial choice.
Still, he suggested the partnership is not exclusive. As the company expands its product series, it may work with other plants as well.
QFN first, more advanced packages later
IndieSemiC's initial packaging roadmap with Kaynes centers on QFN packages, specifically QFN40 and QFN64. Shah confirmed QFN is the immediate target and said the company expects to move toward more advanced package formats later.
On the chip development side, Shah said IndieSemiC has completed front-end work and has entered the back-end phase. The company is now procuring the IP needed to complete the design flow, with plans to submit GDS for MPW by September.
He said the chip is being built using the Vega processor, which he described as an Indian processor, as part of a broader effort to incorporate Indian-developed IP and push beyond basic "Make in India" rhetoric toward more substantive local semiconductor value creation.
Yield remains India's main OSAT hurdle
Asked about India's packaging and testing challenges more broadly, Shah pointed to yield as the biggest issue.
He said established semiconductor customers expect packaging houses to deliver yields in the 99.5% to 99.8% range, and matching that level consistently in India will take time as local operations ramp and stabilize.
"Yield would be the major challenge," Shah said. "We are establishing the technology for the first time in India."
Funding and hiring next
Shah said IndieSemiC is preparing to raise capital, with a preference for strategic partners rather than purely financial investors. The company is looking first for technology-linked partners that can grow alongside it, before turning to venture capital or family offices.
He said fund-raising efforts are expected to begin shortly, with the company looking to close financing within roughly six months.
Talent is another priority. Shah said IndieSemiC expects to need 150 to 200 people over the next five years, spanning R&D and, eventually, production support, as it expands from modules into SoCs.
Article edited by Jack Wu
