The investment of several billion dollars in India could be just the beginning, according to Taiwanese electronic component major Foxconn's Chairman Young Liu. There's positive energy for the Indian market, he said.
Speaking at the investor conference call announcing the group's second-quarter earnings on Monday, Liu said he "enjoyed his time" at the Semicon India 2023 last month.
"There was excitement and our participation over what we could achieve and a determination to get there. In India, Foxconn operates about nine campuses; the total size would be equivalent to 500 football fields," he said. "We have over 30 factories in India with a business size of about $10 billion annually."
Liu said "the India question" has been coming up during the past two quarterly investor calls. "This tells me that there's positive energy for this market. I've said this before: Our capex this year will grow more than last year; the outlook has not changed."
"Foxconn's annual revenue last year was more than $200 billion. From the perspective of India's potential market size, and if we can fully implement our plans there, the several billion dollar investment is only the beginning," he said on the conference call.
Liu had earlier told CNBC TV-18 that Foxconn, which is one of Apple's major suppliers, is looking at India as a vital market and manufacturing hub and said that it will invest over $2 billion in the country over the next five years.
In May, it laid the foundation for a new electronics manufacturing facility in Telangana, committing about $550 million, or around Rs 4,500 crore.
In July, after its semiconductor joint venture with India's Vedanta Ltd. fell through, it signed a letter of intent with the Tamil Nadu government to establish a new mobile component manufacturing facility for Rs 1,600 crore in Kancheepuram with the potential to generate 6,000 jobs.
On Aug. 2, the company also signed a similar agreement with the Karnataka government to undertake two marquee projects in the state with an estimated investment worth Rs 5,000 crore.
Foxconn's diversification into India comes in line with Apple's bullishness towards the country as a retail market and a manufacturing hub. Apple could also move at least 18% of its global iPhone production to India by FY25, according to BofA Securities. "This is based on targets already committed by Apple's contract manufacturing firms under the PLI scheme," the investment banker said in a report.
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