Larsen & Toubro's (L&T) semiconductor arm is targeting $500 million in annual revenue by 2030-31, betting India's nascent chip design industry can become a meaningful export business despite starting from a small revenue base.
“We expect to generate $500 million in revenue by 2030-31. We’ve begun generating commercial revenue already, but we’re still in very early days, and our revenue from semiconductors is much lesser than 10% of where we expect to be in the next four fiscals. Nearly 70-80% of this revenue is expected to come from exports,” Sandeep Kumar, chief executive of L&T Semiconductor Technologies Ltd told Mint in an interview on Thursday.
Incorporated in November 2023, L&T Semiconductor Technologies is a design-focused semiconductor company. Unlike Tata Group, which is building semiconductor fabrication capacity, it designs chips for sectors including power and automobiles.
Fiscal year 2026 (FY26) marked the company's second full year of operations, during which it generated ₹13.52 crore in operating revenue. Kumar's target would require the company to more than triple its revenue every year, including the current fiscal.
Chip scale
Kumar is confident that India's growing semiconductor ecosystem will support that growth trajectory.
“Our first own chip products for key sectors have already been supplied to clients, and in six months, this will scale up in terms of the revenue we generate from it. This is only the first leg, and we have multiple sectors where we are in trial phases—all of which will scale up in the near term,” he said.
The company is targeting applications across power infrastructure and industrial motors, security products such as payment cards and passports, cameras and imaging systems, and servers and data centres.
“We’re also currently looking into the consumer electronics sector, where we can design indigenous chips to be used in USB chargers, ceiling fans and so on. In the long run, the focus on consumers could reduce, but for now, there is a focus on the consumer sector as well.”
L&T Semiconductor Technologies is part of the group's IT and technology services vertical, alongside LTM (formerly LTIMindtree), L&T Technology Services (LTTS) and data centre business Vyoma. The vertical generated ₹53,946.53 crore in FY26, with nearly all of it coming from LTM ( ₹42,308 crore) and LTTS ( ₹10,996 crore).
The chip business is one of several new technology bets for L&T. On 20 November, Arun Ramchandani, senior vice-president and head of precision engineering and systems, told Mint that the company's defence and space engineering business was on track to generate $1 billion in annual revenue by FY26. On 2 March, Vyoma chief executive Seema Ambastha said the group's data centre business was also expected to generate $1 billion in revenue by 2030.
L&T has backed its semiconductor ambitions with fresh capital. According to its FY26 annual report, the parent company invested ₹541.97 crore in L&T Semiconductor Technologies during the year, taking its cumulative investment in the subsidiary to ₹859 crore.
Even so, Kumar said the company remains cautious about server chips because of the long investment cycle. “Much like fabs where you invest $10 billion and wait for it to become operational, in server chips, you have to invest to build chips for three years—and then you start seeing returns in the sector. Though server chips are more expensive and thus offer higher revenue, the investment is longer and higher in volume,” he said.
Selective bets
Industry executives broadly agree with L&T's strategy of focusing on specialized, high-value applications instead of chasing mass-market consumer electronics.
Ashok Chandak, president of industry body India Electronics and Semiconductor Association (Iesa), said the Centre's upcoming Semicon 2.0 incentive programme is expected to provide greater support for fabless companies such as L&T Semiconductor. Even so, he argued that market selection would matter more than subsidies.
"Fabs will always require greater incentives since the capital expenditure is higher. For fabless companies, the key goal should be to target sectors such as industrial electronics—and not even the high-volume consumer electronics market where there are too many established and mature players. Doing so will give Indian fabless chip designers a large market to chase rapid growth," Chandak added.
Kumar said L&T Semiconductor is adopting a wait-and-watch approach until the government releases the final contours of Semicon 2.0.
"We are definitely keen on leveraging the scheme if it gives us suitable guidelines and incentives. We’ll have to evaluate the royalty-based incentive scheme once full details are out—if equity gets involved, we’ll then have to refrain," he said.