Jaypee Group will proceed with its ambitious microchip fabrication facility in partnership with International Business Machines Corp., betting that a new government at the centre will boost infrastructure development, the lack of which has discouraged semiconductor makers from setting up plants in Asia’s third-largest economy.
Setting up a microchip plant can be a risky venture, according to Sanchit Vir Gogia, chief analyst and chief executive of Greyhound Research, an IT and Telecom research and advisory firm.
“Microchip business has been a very risky business. A lot of people got into it and then pulled out of it. Their manufacturing strategy will really decide their margins. We will have to wait and see what their strategy is,” said Gogia. “I am not very worried about the debt levels as this one will be a separate entity altogether.”
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