From Software To Semiconductors: Zoho Aims To Enter Chipmaking Industry With $700 Million Proposal

Indian software firm Zoho is planning to enter the chipmaking industry and is seeking incentives from the federal government, according to a report from Reuters.

Founded in 1996 and headquartered in Tamil Nadu, Zoho offers software and related services to businesses in 150 countries, competing with major companies like Microsoft and Salesforce.

Zoho is the latest company to seek financial incentives from the government to establish a chip fabrication plant.

The same report estimates the investment plan at $700 million.

Semiconductors are a critical focus of India's business agenda, with a $10 billion package aimed at boosting the industry to compete with countries such as Taiwan in the coming years.

As per the report, Zoho plans to manufacture compound semiconductors, which have specialised commercial applications and use alternatives to the more commonly used silicon in chipmaking.

The proposal is currently under review by the panel overseeing India's chip initiatives at the IT ministry, which has requested more information from Zoho about its prospective customers.

The report also mentioned that Zoho has estimated an investment outlay of $700 million and has identified a tech partner to help establish the operation, though the partner was not named.

Zoho generated annual revenue of over $1 billion in the financial year ending March 2023, according to media reports.

In February, India approved the construction of three semiconductor plants worth over $15 billion by firms including Tata Group and CG Power, with plans to manufacture and package chips for sectors including defense, automobiles, and telecommunications.

India projects its semiconductor market will be worth $63 billion by 2026.