Paras Defence Semiconductor Unit To Invest ₹6,200 Crore In Chip Packaging Facility In Madhya Pradesh

Paras Defence and Space Technologies has announced that its subsidiary Paras Semiconductors will invest approximately ₹6,200 crore, equivalent to around $644 million, to establish a greenfield outsourced semiconductor assembly and test facility in the Indore-Ujjain region of Madhya Pradesh.

The subsidiary has entered a memorandum of understanding with the Madhya Pradesh State Electronics Development Corporation to jointly develop the project by combining the expertise and resources of both the entities.

Paras Defence shares were trading 0.19% higher at ₹1,224.91 at 2:48 PM, on 22 July 2026 on the National Stock Exchange (NSE).

What The Facility Will Do

An outsourced semiconductor assembly and test facility, commonly known as an OSAT plant, takes silicon wafers produced by foundries and packages, assembles and tests them to produce finished semiconductor chips.

The proposed Paras Semiconductors facility will handle a wide range of advanced packaging operations, including 3D heterogeneous integration, 2.5D and 3D advanced packaging, hybrid bonding, ultra-high-density fan-out packaging, chiplet integration, wafer bumping, flip-chip assembly, and chip testing and reliability verification.

India's Semiconductor Mission

The investment is in line with India's efforts to build a domestic semiconductor ecosystem. The announcement comes after the Union Cabinet recently approved the India Semiconductor Mission 2.0, a six-year, ₹1.27 lakh crore programme to deepen India's chip supply chain. The revamped scheme provides capital incentives of up to 40% for semiconductor fabrication plants and 35% for advanced packaging facilities like the one Paras Semiconductors is now proposing.

The facility will be set up in the Indore-Ujjain region, with Madhya Pradesh’s department of science and technology and Madhya Pradesh State Electronics Development Corporation (MPSeDC) playing a key role in the development of the project. The investment is expected to support India's efforts to build domestic semiconductor packaging and testing capabilities, a space that has historically been the preserve of overseas players.

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