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Vedanta to Invest $5bn in First Stage for Semiconductor Fab
July 31, 2023
Vedanta Group’s chairman Anil Agarwal has announced that the company will invest $5bn in the first stage for its semiconductor fab, packaging testing unit and display fab unit, Mint reported. The chairman said on Friday at the Semicon India 2023 event, “[We] Have already identified a world-class tech partner for semiconductor and are in the process of tying up with them”. This follows Foxconn’s pullout last month from the JV it had with Vedanta to set up semiconductor and display production plants. Agarwal went on to add that there is a “queue of people” interested in investing through a mix of debt and equity. The project is expected to have a total investment of $19-20bn. He said that the group was in discussions with three technology providers for each of the units that will likely show results in a few months. He also mentioned that the first semiconductor chip will be produced in 2.5 years. While markets are not confident in Vedanta’s debt situation, which stood at $6.5bn as of May 2023, given a sharp drop in its Q1 after-tax profits, Agarwal addressed this by saying that Vedanta has a profit of $7bn and “we have the lowest debt in our peer group”.
Vedanta’s dollar bond prices have trended lower across the board over the past month. In particular, its 9.25% 2026s have fallen 19.3% and are currently trading at 60.6 cents on the dollar.
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