Vedanta rose 1.11% to Rs 365.45 after the company announced signing a memorandum of understanding (MOU) with Foxconn to form a joint venture company that will manufacture semiconductors in India.
Taiwan-based Hon Hai Technology Group ("Foxconn") is the world's largest electronics manufacturing company.According to the MOU signed between the two companies, Vedanta will hold the majority of the equity in the JV, while Foxconn will be the minority shareholder. Vedanta chairman Anil Agarwal will be the chairman of the joint venture company.
The targeted project plans to invest for manufacturing semiconductors. It will provide a significant boost to domestic manufacturing of electronics in India. Discussions are currently ongoing with a few State Governments to finalize the location of the plant.
The collaboration between Vedanta and Foxconn follows the India Government's recent policy announcement for electronics manufacturing & PLI scheme for incentivizing organizations to contribute towards development of this sector. This will be the first joint venture in the electronics manufacturing space after the announcement of the policy.
This joint venture between the two companies will support Indian Prime Minister Narendra Modi's vision to create an ecosystem for semiconductor manufacturing in India.
Vedanta Group is a global diversified group of companies with presence in metals, mining, oil & gas, power, telecom and glass. Vedanta Group has presence in electronics and technology business through group companies, Avanstrate Inc. and Sterlite Technologies.
On a consolidated basis, the diversified natural resources firm's net profit rose 26% to Rs 4,164 crore on 50% increase in net sales to Rs 33,697 crore in Q3 December 2021 over Q3 December 2020.
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