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When investors think about semiconductor manufacturing, the first image is usually a gigantic fabrication plant producing silicon wafers.
But India's semiconductor journey is currently developing differently.
One of the fastest-moving parts of India's chip ecosystem is not wafer fabrication—it is semiconductor assembly, testing and packaging.
This segment is generally referred to as OSAT — Outsourced Semiconductor Assembly and Test — or ATMP, meaning Assembly, Testing, Marking and Packaging.
And in 2026, India moved decisively from announcing OSAT projects to actually producing semiconductor products.
Micron began commercial production at its Sanand plant on 28 February 2026. Kaynes Semicon followed on 31 March 2026, while CG Semi commenced commercial production in July. By September, the Government of India reported that five approved semiconductor units had entered commercial production.
More importantly, packaging isn't a small side-story within India's semiconductor programme.
Of the 12 semiconductor manufacturing units approved under Semicon 1.0, nine are packaging units. Together, all 12 approved projects represent more than ₹1.64 lakh crore of investment. Source: Government of India, September 2026.
For investors researching semiconductor stocks in India, that creates an important question:
Could OSAT and advanced semiconductor packaging become one of India's first commercially scalable semiconductor opportunities?
To answer that, we first need to understand what OSAT actually does.
What is OSAT in semiconductors?
A semiconductor wafer coming out of a fabrication plant is not yet the finished chip that goes into an automobile, smartphone, server or industrial machine.
The wafer contains multiple individual semiconductor dies.
Those dies need to be separated, connected electrically, packaged, protected from the external environment and tested for reliability before being supplied to customers.
That is where OSAT companies enter the value chain.
A simplified semiconductor manufacturing chain can be understood as:
Chip Design → Wafer Fabrication → Assembly & Packaging → Testing → Electronic System
OSAT companies operate primarily in the later stages.
This is not merely putting a plastic cover around a chip.
Modern semiconductor packaging can involve multiple chips inside a package, increasingly complex interconnections, power management, thermal management, substrates and sophisticated testing.
And as computing systems become more complex, packaging technology is becoming increasingly important.
That is one reason the Government's Semicon 2.0 programme explicitly includes further strengthening ATMP/OSAT as one of its six strategic pillars, with particular emphasis on bringing more advanced packaging technologies to India.
Why is India focusing so heavily on OSAT?
There is a practical reason.
Building a leading-edge semiconductor fab is extraordinarily capital intensive, technologically difficult and time consuming.
India's Tata Electronics-PSMC wafer fab at Dholera, for example, involves an investment of approximately ₹91,526 crore and planned production capacity of around 50,000 wafer starts per month.
Compare that with India's major packaging projects.
CG Power's semiconductor project involves approximately ₹7,584 crore of investment, while Kaynes Semicon's project is approximately ₹3,307 crore.
Packaging therefore offers India a potentially faster route into global semiconductor supply chains.
It can also create an ecosystem around:
semiconductor substrates, specialty chemicals, clean rooms, testing equipment, precision engineering, connectors, PCB manufacturing, power electronics and electronics assembly.
That is why OSAT may become an important bridge between India's existing strength in electronics manufacturing and its longer-term ambition to manufacture semiconductor wafers domestically.
OSAT stocks in India: which listed companies have direct exposure?
One of the problems with searching for “semiconductor stocks in India” is that many lists mix semiconductor designers, EMS companies, electronics companies, equipment suppliers and chip-packaging businesses together.
For OSAT specifically, the list of Indian-listed companies with identifiable exposure is much narrower.
| Listed company | OSAT exposure | Current positioning |
|---|---|---|
| CG Power & Industrial Solutions | CG Semi | Large new OSAT platform; commercial production started in 2026 |
| Kaynes Technology India | Kaynes Semicon | OSAT + EMS + PCB strategy; commercial production underway |
| SPEL Semiconductor | Existing IC assembly and testing operations | Small legacy listed semiconductor assembly/test company |
These businesses are very different in scale, financial strength and stage of development.
That distinction is important.
1. CG Power: building one of India's largest OSAT platforms
CG Power & Industrial Solutions has emerged as one of the most significant listed participants in India's semiconductor-packaging build-out through CG Semi Private Limited.
CG Semi is a partnership involving CG Power, Renesas Electronics and Stars Microelectronics.
The Government-approved semiconductor project involves an investment of approximately ₹7,584 crore and has planned production capacity of roughly 15.07 million semiconductor units per day.
Commercial production commenced at the Sanand facility on 4 July 2026. Source: PIB, 4 July 2026.
The government said chips produced there are intended for applications including automobiles, scooters and industrial equipment, while exports are targeted toward markets including Japan, the United States and Europe.
The connection between CG Power shareholders and the semiconductor venture is also relatively direct.
CG Power's corporate disclosures identify CG Semi as a subsidiary. CG's FY2024-25 annual report disclosed a 92.34% equity holding in CG Semi. Source: CG Power annual report FY2024-25.
That makes CG Power quite different from cases where investors buy a listed group company merely because another privately held company belonging to the same corporate group has announced a semiconductor project.
However, there is another distinction investors should understand.
CG Power itself is not a pure semiconductor company.
It remains a large diversified electrical engineering business. Semiconductor packaging represents an emerging business within a substantially larger enterprise.
Its semiconductor investment thesis therefore depends not simply on whether India's semiconductor industry grows, but eventually on factors such as CG Semi's utilisation, customer qualification, product mix, margins and return on invested capital.
2. Kaynes Technology: attempting to build a silicon-to-system platform
Kaynes Technology represents a different OSAT strategy.
Its subsidiary, Kaynes Semicon, has built an OSAT facility at Sanand involving approximately ₹3,307 crore of planned investment.
The project has planned capacity of more than 6.33 million chips per day and includes wire-bond interconnect and substrate-based semiconductor packages.
Commercial production officially began on 31 March 2026. Source: Prime Minister's Office.
What makes Kaynes particularly interesting from an ecosystem perspective is its attempt to connect multiple layers of electronics manufacturing.
Kaynes already operates in Electronics System Design and Manufacturing, or ESDM. It is now adding semiconductor packaging while simultaneously developing advanced PCB manufacturing.
The company's FY2025-26 annual report describes the strategy as moving toward a “silicon-to-systems” value chain, combining OSAT, PCB manufacturing and electronics manufacturing. Source: Kaynes annual report FY2025-26.
Kaynes has also reported commercial delivery of multi-chip modules from its OSAT operations.
On the day production formally commenced, the government said the Sanand facility was manufacturing Intelligent Power Modules, including products intended for electric-vehicle and heavy-industrial applications.
That gives the Kaynes story a slightly different character from CG Power.
Rather than semiconductor packaging existing as a relatively separate new industrial vertical, Kaynes is attempting to integrate packaging upstream with its existing electronics-manufacturing capabilities downstream.
If successful, the same customer relationship could potentially extend across semiconductor packaging, PCB manufacturing and final electronics systems.
But again, investors need to separate potential capacity from realised financial performance.
A newly commissioned OSAT facility still needs to increase utilisation, qualify customers, maintain yields and prove that large capital investment can generate attractive returns.
3. SPEL Semiconductor: India's older listed assembly-and-test company
Not every Indian OSAT company is new.
SPEL Semiconductor Limited, listed on the BSE, describes itself as an IC assembly and test company and has operated in semiconductor assembly and testing for several decades.
This makes SPEL one of the few relatively pure listed semiconductor-packaging businesses in India.
But “pure play” does not automatically mean “better investment.”
Its FY2025-26 annual report shows the company remains very small compared with the new semiconductor projects being developed in India.
SPEL reported FY2025-26 sales of approximately ₹6.28 crore, down from ₹7.86 crore in the previous financial year, and reported a loss for the year.
That illustrates an important lesson when researching semiconductor stocks.
Business classification and business quality are two different questions.
A company can have direct semiconductor exposure but still face challenges relating to scale, profitability, technology, capital requirements or customer concentration.
Conversely, a diversified company may have less semiconductor revenue today but possess considerably greater financial resources to scale a new semiconductor business.
The semiconductor label by itself tells investors very little.
The OSAT companies investors cannot directly buy in India
Some of India's largest semiconductor-packaging projects are not independently listed Indian stocks.
This distinction is worth understanding because investors sometimes incorrectly use listed group companies as proxies.
Micron Technology
Micron's Sanand facility was the first large semiconductor facility under the current India Semiconductor Mission to enter commercial production in 2026.
The project involves approximately ₹22,516 crore of investment and is designed for assembly and testing of DRAM and NAND products, with government-disclosed production capacity of around 14 million units per week. Sources: Government project disclosures and Micron inauguration announcement.
Micron, however, is a US-listed semiconductor company rather than an Indian-listed stock.
Its Sanand plant converts semiconductor wafers produced in Micron's global manufacturing network into finished memory and storage products.
This difference is useful because it demonstrates exactly where OSAT sits in the manufacturing chain:
the silicon wafer can be manufactured elsewhere, while packaging and testing happens in India.
Tata Electronics
Tata Electronics is developing a massive semiconductor assembly and test facility in Jagiroad, Assam.
The approved investment is approximately ₹27,120 crore, with planned production capacity of around 48 million units per day.
As of SEMICON India in September 2026, Tata Electronics said construction of both its Dholera wafer fab and Jagiroad OSAT facility remained on track.
But Tata Electronics itself is not independently listed.
Therefore, investors should not automatically assume that Tata Technologies, Tata Elxsi or another publicly traded Tata company represents direct economic ownership of the semiconductor project simply because they share the Tata name.
The economic connection must be verified through the actual corporate ownership structure.
HCL–Foxconn semiconductor project
Another important OSAT project is being developed in Uttar Pradesh through a joint venture between Vama Sundari Investments and Foxconn.
The project involves approximately ₹3,706 crore of investment and is intended to manufacture and package display-driver ICs using gold-bump technology, together with chip probing and die-processing services.
Planned capacity is approximately 20,000 wafers per month or 36 million chips per month. Source: Government of India project disclosures.
Again, investors should be careful with listed-company proxies.
The existence of “HCL” in the broader corporate ecosystem does not automatically mean that purchasing HCL Technologies shares provides direct proportionate ownership of the semiconductor unit.
Group affiliation and economic ownership are not the same thing.
India's OSAT ecosystem is now bigger than three plants
The development of semiconductor packaging in India is beginning to spread across multiple states and technologies.
The approved pipeline includes projects involving advanced glass substrates and heterogeneous integration, silicon-carbide semiconductor packaging, power semiconductor devices and other assembly-and-test technologies.
In September 2026, commercial production was also inaugurated at Suchi Semicon in Surat, alongside a new commercial production line at CDIL Semiconductor in Mohali. Source: PIB, SEMICON India 2026.
The government reported that five approved semiconductor units were in commercial production by that point.
This matters because semiconductor ecosystems tend to become more valuable as clusters form.
A packaging plant does not operate alone.
It requires specialised machinery, materials, chemicals, substrates, clean-room infrastructure, testing equipment, logistics and skilled engineers.
As several plants become operational, suppliers gain a larger potential domestic customer base.
That is where the second-order semiconductor opportunity may eventually emerge.
From conventional packaging to advanced packaging
Perhaps the most important development for investors to watch is not simply how many OSAT plants India builds, but what kind of packaging they can perform.
Traditional packaging generally places an individual semiconductor die inside a protective package and connects it to the external circuit board.
Advanced packaging can bring multiple semiconductor dies together into a single high-performance package.
Technologies include chiplets, System-in-Package, wafer-level packaging, 2.5D and 3D integration and other forms of heterogeneous integration.
This matters enormously for AI and high-performance computing.
Instead of relying only on shrinking transistors onto ever-more-advanced process nodes, semiconductor companies increasingly improve system performance by combining specialised chips using advanced packaging.
That changes the strategic importance of the back end of semiconductor manufacturing.
Packaging is no longer simply the low-value final step after fabrication.
It can increasingly determine system performance, power efficiency, bandwidth and thermal management.
The Indian government's policy appears to recognise this shift.
Semicon 2.0 explicitly identifies advanced ATMP technologies as an area India intends to attract and develop.
Why OSAT could connect India's AI, EV and electronics themes
The opportunity is broader than smartphones.
Different semiconductor packages are needed across rapidly growing technology markets.
AI servers require high-performance computing and memory integration.
Electric vehicles require power semiconductor modules.
Industrial automation requires microcontrollers, sensors and power devices.
5G infrastructure requires RF and connectivity chips.
Renewable-energy systems require power semiconductors.
Consumer electronics require memory, controllers, display-driver ICs and connectivity chips.
India is simultaneously expanding manufacturing in many of these downstream sectors.
That creates the possibility of a reinforcing cycle:
more electronics manufacturing → more semiconductor demand → more packaging capacity → larger local component ecosystem → deeper electronics localisation.
This is why semiconductor packaging may deserve to be treated as a distinct theme rather than merely a small subsection of semiconductor manufacturing.
What should investors track in an OSAT company?
The easiest mistake is to focus on announced capacity.
For a new semiconductor facility, capacity is only the starting point.
What matters economically is how much of that capacity can be successfully qualified and utilised.
For a listed company entering OSAT, some of the most important things to monitor are customer qualification, volume ramp-up, utilisation, manufacturing yields, package complexity, technology partners, customer concentration, semiconductor revenue contribution, operating margins and return on the capital invested.
There is also a major difference between packaging relatively conventional semiconductor products and developing advanced packaging capabilities.
Two facilities with the same headline chip capacity may therefore have very different economics.
Three numbers investors should not confuse
When analysing semiconductor projects, three terms often get mixed together:
Announced capacity
This is what a proposed plant is eventually designed to produce.
Installed capacity
This means the machinery and production lines actually exist.
Commercial production
This means the facility has begun manufacturing products that can be supplied commercially.
Even commercial production does not automatically mean full utilisation.
A semiconductor plant can begin production while operating at only a small fraction of its eventual capacity.
For an investment thesis, utilisation and commercially qualified customer volumes often matter far more than headline capacity.
Does India have listed pure-play OSAT stocks?
There are very few.
SPEL Semiconductor is among the closest existing listed pure-play assembly-and-test companies, but it is currently very small and has reported losses.
CG Power and Kaynes Technology offer exposure through much larger emerging OSAT operations, but both are diversified businesses rather than pure semiconductor stocks.
Meanwhile, major Indian projects such as Tata Electronics, Suchi Semicon and Sahasra Semiconductors remain privately held, while Micron is listed outside India.
That is why a simple ranking of “top OSAT stocks in India” can be misleading.
The businesses differ significantly in ownership structure, scale, technology and financial maturity.
OSAT vs semiconductor fab: what is the difference?
A semiconductor fab manufactures circuitry on silicon wafers through processes such as lithography, deposition, etching and implantation.
An OSAT facility typically receives fabricated wafers or semiconductor dies and performs assembly, packaging and testing.
The two are complementary rather than competing businesses.
India needs both.
But they have different capital requirements, technologies, timelines and economic models.
India's first major silicon fab under the current programme is being developed by Tata Electronics with PSMC at Dholera.
In contrast, several semiconductor-packaging plants have already reached commercial production.
That helps explain why packaging has become India's first major entry point into semiconductor manufacturing.
Is OSAT only a temporary step before India builds fabs?
Probably not.
Even countries with major semiconductor fabrication industries require large packaging-and-testing ecosystems.
And the global industry itself is moving toward increasingly sophisticated packaging architectures.
So India's OSAT industry should not simply be thought of as training wheels before wafer fabs arrive.
If domestic companies develop advanced packaging, testing, reliability and manufacturing capabilities, OSAT can become an important semiconductor industry in its own right.
The government's decision to dedicate an entire pillar of Semicon 2.0 to strengthening ATMP/OSAT suggests policy makers are thinking along similar lines.
Frequently Asked Questions
What does OSAT stand for?
OSAT stands for Outsourced Semiconductor Assembly and Test. OSAT companies package semiconductor dies into usable products and perform electrical and reliability testing before the chips are supplied to customers.
What does ATMP stand for?
ATMP means Assembly, Testing, Marking and Packaging. The terms ATMP and OSAT are frequently used together in India's semiconductor policy.
Which listed companies in India have OSAT exposure?
Among listed Indian companies, CG Power has semiconductor-packaging exposure through CG Semi, while Kaynes Technology owns Kaynes Semicon. SPEL Semiconductor is an older listed IC assembly-and-test company.
The scale and financial characteristics of these businesses are very different.
Is Tata Electronics an OSAT stock?
Tata Electronics is developing a major semiconductor assembly-and-test facility in Assam, but Tata Electronics itself is not independently listed on Indian stock exchanges.
Is HCL Technologies an OSAT stock?
An HCL Group–Foxconn-linked semiconductor project is being developed through Vama Sundari Investments and Foxconn. Investors should not assume that this automatically creates equivalent direct economic exposure through listed HCL Technologies. Corporate ownership needs to be examined separately.
Is CG Power a semiconductor company?
CG Power is primarily a diversified electrical engineering company. However, it has significant direct semiconductor exposure through its subsidiary CG Semi, which commenced commercial OSAT production in 2026.
Is Kaynes Technology a semiconductor company?
Kaynes historically built its business around electronics system design and manufacturing. Through Kaynes Semicon it has now entered semiconductor assembly, testing and packaging and is attempting to integrate OSAT with PCB and electronics manufacturing.
The bottom line
India's semiconductor story may initially be built from the back end forward.
While India's first major commercial wafer fab is still being developed, multiple semiconductor assembly-and-packaging facilities have already moved into production.
That is significant.
Under Semicon 1.0, nine of India's twelve approved semiconductor manufacturing projects are packaging facilities. Semicon 2.0 now goes further by explicitly targeting more advanced semiconductor packaging technologies.
For investors, however, this does not mean every company associated with OSAT should be valued as a semiconductor winner.
CG Power, Kaynes Technology and SPEL Semiconductor represent three very different types of exposure.
CG Power is a large industrial business building a substantial new semiconductor subsidiary.
Kaynes is attempting to combine OSAT with PCB manufacturing and its existing electronics-manufacturing platform.
SPEL is an older and more direct semiconductor assembly-and-test company, but currently operates on a much smaller financial scale.
Meanwhile, several of India's most important OSAT projects—including Tata Electronics, Suchi Semicon and Sahasra Semiconductors—are not independently listed Indian stocks.
The useful question for investors is therefore not:
“Which company has announced an OSAT plant?”
It is:
“Who owns the semiconductor business, what packaging technologies can it execute, which customers have qualified the plant, how quickly is utilisation increasing, and what returns can the business eventually generate on the capital being invested?”
Those factors will determine which companies ultimately capture economic value from India's semiconductor-packaging build-out.
Also read: Semiconductor Stocks in India 2026: Companies Building India’s Chip & Electronics Ecosystem.
Disclaimer: This article is for educational and informational purposes only and should not be considered investment advice or a recommendation to buy or sell any security. Investors should independently evaluate financial performance, valuation, risks and suitability before making investment decisions.