India achieved a significant milestone in its semiconductor manufacturing journey as Kaynes Semicon delivered the country's first commercially packaged multi-chip module (MCM) to California-based Alpha & Omega Semiconductor (AOS). The shipment of approximately 900 intelligent power modules (IPMs) was rolled out from Kaynes Semicon's outsourced semiconductor assembly and test (OSAT) facility in Sanand in the early hours of Wednesday.

The delivery represents the inaugural commercial production from India's semiconductor manufacturing sector under the India Semiconductor Mission 1.0 (ISM). AOS, headquartered in Sunnyvale, operates as a designer, developer and global supplier of power semiconductors.

Advanced Multi-Chip Module Technology

The intelligent power modules shipped to AOS represent sophisticated semiconductor technology that integrates power switching elements with their corresponding drive and protection circuits into a single, compact package. These devices are designed to simplify motor control and other power applications. According to Raghu Panicker, CEO of Kaynes Semicon, the modules contain 17 dies inside, including six IGBTs (insulated gate bipolar transistors), two controller ICs (integrated circuits), six FRDs (fast recovery diodes) and three diodes.

This configuration places the modules among the most advanced in the domain, with German chip company Infineon remaining the market leader in this segment. The complexity of these multi-chip modules distinguishes them from simpler single die packaging approaches typically pursued by companies in the sector. Multi-die packaging integrates multiple smaller dies, or “chiplets,” within a single package, allowing designers to mix and match different technologies and fabrication processes.

This approach delivers benefits including higher yields, faster time-to-market, improved modularity, and the ability to create more powerful and customized products than what is possible with a single large die.

Production Capacity and Future Plans

Manufacturing at Kaynes Semicon's pilot line commenced in April 2024. The facility currently maintains a capacity to produce 3,000 pieces per day, with plans to send another shipment to AOS next month. The Gujarat facility is designed to reach a total capacity of 6.3 million chips per day once fully operational. The current delivery marks the beginning of commercial production for AOS, with full mass production targeted for January 2026.

AOS is expected to utilize most of the initial capacity, with production scaling up to approximately 1.5 million chips per day by Q1 2026-27. Under the agreement between the companies, Kaynes is required to provide 10 million chips annually to AOS for five years.

Investment and Government Support

The Sanand OSAT facility operates under the aegis of India Semiconductor Mission 1.0 (ISM) with substantial government backing. The total investment for the OSAT unit amounts to INR 3,307 crore, with funding distributed across multiple sources. The Center contributes 50% of the investment (INR 1,653.5 crore), the Gujarat government provides 20% (INR 661.4 crore), and the remaining INR 992.1 crore comes from the company. Kaynes has committed approximately INR 400 crore to the facility thus far.

In September of the previous year, the Mysuru-headquartered firm became the fourth company in India to receive government approval for establishing an OSAT facility. Other approved companies include Micron, Tata Semiconductor Assembly and Test, CG Power, HCL-Foxconn, 3D Glass Solutions, ASIP Technologies, and CDIL.

Industry Applications and Market Positioning

The intelligent power modules produced at the Sanand facility serve high-power and critical applications spanning electric vehicles (EVs) to renewable energy sectors, which demand high reliability and safety standards. These applications require sophisticated power semiconductors including IGBTs and MOSFETs (metal oxide semiconductor field-effect transistors) integrated with control and protection circuits such as controller ICs and gate drivers.

Neil Shah, a technology industry analyst and partner at Counterpoint Research, noted that Kaynes' approach represents a significant leap beyond basic packaging to commercially shipping complex and highly integrated modules through advanced packaging, assembly and testing processes. The manufacturing capability for such single, compact, high-performance modules with complex integration validates Kaynes' readiness to partner with global players including AOS, Infineon and others in these segments.

Shah observed that this positions Kaynes closer to successful global integrated device manufacturers (IDMs) and other OSAT players, though he noted that scaling beyond one product and one customer consistently with appropriate yields, quality and efficiency remains a challenge for the company to prove going forward. Founded in 1988, Kaynes Technology operates as a listed Indian electronics manufacturing services (EMS) provider with capabilities spanning design-led manufacturing, IoT solutions, and integrated electronics systems. Its semiconductor subsidiary, Kaynes Semicon, represents a key pillar of the company's strategy to align with India's semiconductor mission.

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