The semiconductor shortage is expected to continue for the next 2-3 quarters and slowly start easing as new capacities start operations as well as plants in Texas and Japan (Renesas) return to normalcy after being hit by calamities, Motilal Oswal has said in a report.
"This will have varying impact across the supply chain, with global companies having a bigger impact than India-focused players. Semiconductors in particular and electronics in general are the few remaining areas of localization in the Indian Automotive supply chain. With government focus, supportive policy measures, and incentives, we are hopeful about increased localization over the next 3-4 years. In the interim, we expect limited impact of semiconductor shortages on MSIL and 2W players, reasonable impact on MM and CV OEMs, and a higher impact on TTMT (JLR) and component suppliers that have a huge exposure to global OEMs (like MSS, MACA, ENDU, etc.)," Motilal Oswal has said in a report.
India has an opportunity in 65nm and 90nm nodes for analogue and mix signal fabs, the firm has said. "IESA is working with the Indian as well as Taiwanese government. It has sent a proposal to the Taiwanese semiconductor companies to shift production of 90nm and 65nm chips to India, and use the existing fab infrastructure in Taiwan to manufacture chips with the latest technology. Mature nodes are over 12nm. New nodes are expensive to produce and are set-up globally with substantial government support," Motilal Oswal has said in its report.