Tata Semiconductor Unit Secures $735 Million in Loans
The filings show lenders have imposed conditions requiring the Tata group to retain a majority stake in the unit and continue using its brand name.
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Five foreign banks back the Gujarat chip project with conditions tied to group control, underscoring reliance on Tata’s credit strength over asset value.
Tata Semiconductor Manufacturing Pvt. Ltd has secured ₹6,835 crore ($735 million) in loans from five foreign banks to support its ₹91,000 crore semiconductor facility in Gujarat, Mint reported, citing filings with the Ministry of Corporate Affairs.
The filings show lenders have imposed conditions requiring the Tata group to retain a majority stake in the unit and continue using its brand name.
The loan, repayable by 2031, also mandates a minimum equity buffer of ₹130 crore for every ₹170 crore borrowed.
The Gujarat government has leased 163.5 acres of land to Tata Electronics for the project, with the asset recorded at zero value in official filings due to its undeveloped status, the report said.
Despite that, the land has been pledged as collateral, with lenders relying primarily on Tata’s credit profile rather than the underlying asset, the report added.
The funding was raised through branches in Gujarat International Finance Tec-City, helping secure relatively lower borrowing costs. HSBC, MUFG, First Abu Dhabi Bank, DBS and ANZ were among the lenders, the reort added.
Tata Electronics has invested about ₹3,690 crore in the project since November 2023.
The facility, being developed with Taiwan’s Powerchip Semiconductor Manufacturing Corp., is expected to begin trial production by mid-next year with an initial capacity of 50,000 chips per month.
The project remains closely watched as India seeks to build domestic semiconductor manufacturing capability, with execution during the trial phase seen as a key milestone.
