CG Semi OSAT plant starts output: 200m chips in 2026

Commercial production begins at Sanand OSAT

Prime Minister Narendra Modi inaugurated the start of commercial production at CG Semiconductor’s outsourced semiconductor assembly and test (OSAT) facility in Sanand, Gujarat. At the event, he said the plant will produce 20 crore (200 million) chips annually. The facility is positioned as one of the packaging and testing units being built under the broader push to expand India’s semiconductor manufacturing footprint. The Sanand unit is also described as the country’s third semiconductor plant to commence commercial production of chip packaging. Modi said the Semicon India programme was gathering momentum “step by step, brick by brick and chip by chip.”

What the plant will manufacture and how capacity is described

According to statements reported from the inauguration, the Sanand facility’s starting point is 200 million chips a year. The same set of remarks also referenced a scale-up target to 500 crore chips a year, and separately a target of manufacturing 500 million chips annually was mentioned in the coverage. CG Semi has also described capacity in multiple ways across disclosures and reports, including peak annual processing capacity and units-per-day throughput at full ramp. A Business Wire update said the G1 facility has a peak capacity of up to 300 million units per year. Separate reporting said that at full ramp the site could handle 15 million units a day, which was described as implying a peak annual capacity of roughly 4.7 billion chips.

First commercial shipment dispatched to global customers

As part of the inauguration-related updates, CG Semi’s first commercial shipment from the Sanand OSAT facility was dispatched to global customers of its Japanese technology partner, Renesas. Another report specified that the first commercial consignment was dispatched on June 19, 2026, and sent to Kuala Lumpur airport. The same account said the shipment is meant to serve customers of Renesas Electronics, which is both a joint venture partner and an anchor customer for the facility. The start of shipments is a key operational milestone for an OSAT unit because it indicates packaged and tested output is now moving into customer supply chains.

Ownership and partners behind CG Semi

CG Semi Private Limited is described as a joint venture between CG Power and Industrial Solutions Ltd. (Murugappa Group), Japan’s Renesas Electronics Corporation, and Thailand’s Stars Microelectronics. CG Power holds 92.3% of the venture, according to the reports provided. The facility is part of an investment plan of INR 7,600 crore over five years, which was also described as around $170 million. The joint venture structure is relevant because OSAT operations typically require qualified process know-how and customer relationships, particularly in automotive and industrial segments where reliability requirements are high.

The Sanand site in the context of India’s packaging push

The Sanand OSAT unit is described as the third packaging plant to come online under the India Semiconductor Mission, after Micron and Kaynes Semicon. This positions the CG Semi plant within a sequence of projects focused on assembly, packaging, and testing rather than wafer fabrication. Packaging is often the faster path to building domestic capability because it relies on different infrastructure than a fab and can be linked quickly to global customers. The commercial production start also aligns with the policy narrative around moving from chip design into manufacturing-linked supply chains.

Timeline: inauguration, pilot line and commercial output

CG Semi’s G1 facility was inaugurated in August 2025, based on the Business Wire description. Reporting around August 28, 2025 also said the Union minister for electronics and IT, Ashwini Vaishnaw, inaugurated the assembly pilot line at the Sanand site. That 2025 coverage linked the pilot line to producing 0.5 million chips per day and the “first Made-in-India” chip coming from the site. In 2026, commercial production and shipments were confirmed as underway, including a June 19 dispatch cited in one report. The combination of these milestones indicates a transition from pilot operations to commercial shipments within roughly a year.

Workforce and execution details shared publicly

CG Power Chairman Vellayan Subbiah said more than 75 specialists from the Philippines, South Korea, the US and Malaysia worked alongside Indian teams. For OSAT lines, external specialists are often involved in equipment installation, process qualification, yield improvement, and training. While the reports do not specify the exact product mix, the operational scope is described as chip assembly, packaging, testing, and post-test services. One report also stated the plant has a peak processing capacity of around 0.5 million units per day for the pilot OSAT line.

Key facts table

Market impact and what investors should track

The start of commercial production is a tangible execution milestone for CG Power’s semiconductor subsidiary because OSAT economics depend on sustained utilisation and customer qualification. The presence of Renesas as a technology partner and anchor customer is significant in the reports because it links output to an established global customer base for packaged chips. For the broader India semiconductor ecosystem, the plant adds packaging and testing capacity at a time when multiple projects are at different stages of commissioning. Investors will likely track whether reported capacity figures converge over time into consistent guidance, as the coverage includes multiple targets and peak capacity references. Another watchpoint is the ramp path described in earlier reporting, which spoke about scaling from 0.5 million chips per day to 15 million once a second complex is ready in 2027.

Conclusion

CG Semi’s Sanand OSAT plant has started commercial production and has begun shipping packaged chips, with public statements pegging initial output at 200 million chips annually. The company and government commentary also point to higher scale-up targets and additional capacity once future facilities come online. The next set of confirmations investors will look for are updates on ramp timelines, sustained shipment volumes, and commissioning progress for expansion plans referenced for 2027.