450mm fab to be much more cost competitive: De Core

GANDHINAGAR & NOIDA, INDIA: Here is an interview with Deepak Loomba, MD and CEO of the De Core Group, one of the few Indian companies to have set up a fab for developing LEDs in Gandhinagar, Gujarat, and Noida.

He speaks about the challenges of putting up a fab in India, and how to overcome those, and why there should be 450mm fabs. Excerpts:

CIOL: How easy or difficult has it been to set up a fab in India?

Deepak Loomba: It has certainly not been easy; it has been really difficult to set up a fab in India. About 100 percent, it was a difficult challenge, but we have been able to do it and I'm happy that we have done it.

CIOL: What are the main challenges faced? How have you overcome them?

DL: Firstly, it has been challenging, largely because there has not been any history of semiconductor fab in India. Therefore, we don't have the appropriate vendors within India who could provide services of making a cost effective and quality clean room. Lot of engineering had to be done in-house for lack of substantial support.

Getting a multinational corporation to come in and to do the job in India was also a challenge because it's pretty expensive and not as cost effective. In building any fab, other than the equipments, it is the utilities that are a major cost carrier. So if we make the utilities more cost effective, the capital cost of the plant is going to be lesser, and hence, the product that you make would be more competitive.

We don't have things like semicon-grade gases easily available in India, so appropriate amount of purification and all other challenges, which are concerned and connected with the supply of semicon grade material and chemicals has been a challenge.

Second, we don't have the required infrastructure. By this, I don't mean the roads, but certainly, uninterrupted power supply, which is a challenge. We addressed this challenge by putting up the plant in Gujarat, which does supply uninterrupted power supply.

A third challenge has been largely associated with absence of much talent within India because we don't have this industry. Hence, there are very few young people to take up material science and follow it up with a job.

The only option left was to recruit newcomers or freshers from good colleges like IITs and train them from scratch. We really don't have the industry as well as the school of thought in material science.

This is the biggest challenge, because it cannot be addressed by pouring money. For solving such a challenge, opportunities have to be created in India for people to take material science as a career option.

Unfortunately, within India, the career option for material science has been to join either CSIR or Department of Science and Technology Institutes, which of course, is an option, but it is more academic, rather than industrial in nature.

The industrial option of getting into material science, doing what you like the most, and, at the same time, earning a good salary for having a good career is another very big challenge. I would say: talent, with experience within India, is the biggest challenge.

The way you can overcome this challenge is to take a root cause approach, or should I say, a root analysis, a fundamental approach. One has to do things that are fundamentally required to be done: to create the required talent pool and the experience to put up a fab in India.

Otherwise, we would have been dependent on the other people who would set up up the fab for us and probably, we would still be paying them lot of money for this.

CIOL: Where do you see the opportunities ahead?

DL: What will be the situation two years from now is difficult to guess, but yes, India is growing by leaps and bounds, so there is going to be big market available. If we have a local industry, addressing this challenge for making CMOS devices, there is an opportunity.

I also feel that the current preferred market access policies are going to 100 percent encourage people to come and put up fabs in India. In optoelectronics, be it in LEDs, solar cells, etc., there is a huge opportunity. The market exists, so it is not something like that needs to be built. If one houses a good quality fab and produces quality products, you can sell it not only in India, but also abroad.

CIOL: While the world is moving to 450 mm, we are going towards 300mm. What's your position?

DL: Well, I would not be ideally placed to comment on this, because I'm not from the silicon industry. However, movement toward 450mm fabs is to do with competitiveness. So yes, the 450mm fab is going to be much more cost competitive, because the amount of material and time required for making or processing a 450mm wafer and 300mm is going to be more or less same.

However, the number of chips that comes out of 450mm vis-a-vis 300mm is going to be substantial. In terms of percentage, it would be 450^2 over 300^2, which turns out to be 2.25 times. The number of chips that one can get out of a 450mm of wafer is going to be almost twice than that of a 300mm. It also means, with the same cost of processing, you are almost reducing the cost by half per device.

Having a fab in India is a welcome step because there is a huge market available and we need a good fab in India, so, at least, the Indian market can be addressed.

CIOL: What's your take on the outlook for the Indian semiconductor industry in 2014?

DL: The India semiconductor industry is going to grow with higher use of mobile phones and electronic gadgets. There is no single electronic gadget which doesn't use semiconductor devices. I think two devices are going to be ubiquitous: one is an LED, you will find it in everywhere, starting from television, mobile phones, headlights, etc. They will swarm the general electric lighting sector and then, concurrently, every LED is to be driven using a power electronics IC.

When it comes to LED, every LED lamp will have few ICs on it, so it is really not possible to have quality LED product without silicon getting into it. While, we as a LED manufacturer, are not really a silicon industry because we don't use silicon at all. We are a compound semiconductor industry and use sapphire with GaN epitaxy on it which is, pretty different from what the silicon industry does.

CIOL: What is your comment regarding the Indian government sanctioning two groups to set up fabs in India?

DL: The companies that have been sanctioned by the government of India have still to make the fabs happen. So let's wait till those happen.

CIOL: What is the status of De Core's Gandhinagar fab as of now?

DL: Our fab, De Core Nanosemiconductor, is ready, and we have partially commissioned it. Full commission is anticipated in December 20133, after which the first lot of commercial viable product is going to be available around the month of March 2014.

The trial runs are already on.

We are in the job of so to say, India's first compound semiconductor fab is more or less in place where we are going to manufacture commercial grade products. The die packaging is done in Noida, which packages LED dies into LED modules, and is fully commissioned and in operation.

Once the Gandhinagar fab happens, it makes us a fully vertically integrated company. The only others that I know would be Cree, Osram, Phillips Lumileds, etc. As we will grow the crystal, process the wafer, make the dies, the dies are then transported to Noida.

The dies get checked, wire bonded, coated and we finally get an LED. From that LED, we manufacture the final product like a street light, solar lantern, or commercial lighting.