India Acquires 51% Stake in Kunshan Company, Precision Module Industry Breakthrough?
India is leveraging technology and supply chain advantages from China and globally to accelerate its manufacturing growth. Attracting foreign capital to set up factories, participate in joint ventures, or make acquisitions is the fastest and most effective way for India's smart manufacturing to take off.
On July 15th, Kunshan Qian Taike Electronics (India) Ltd., a factory of Kunshan Qian Taike Electronics Co. Ltd. from China, became a hot topic in Indian financial media.
Dixon Technologies (India) Ltd. announced that it has signed a binding agreement to acquire a 51% stake in Kunshan Qian Taike Electronics (India) Ltd. through a combination of primary and secondary investments. The deal's financial details were not disclosed.
This acquisition is behind India's ambition to boost its precision module industry. Through this acquisition, India aims to reduce its dependence on imported high-end components, which is in line with the country's overall vision.
Why Acquire Kunshan India Company?
We will briefly review the history of Kunshan Qian Taike Electronics Co. Ltd.
Kunshan Qian Taike Electronics Co. Ltd., a company that specializes in R&D, production, and sales of digital camera modules, LCD, LCM display screen modules, LCM liquid crystal display modules, SMT electronic components, wireless communication modules, MEMS sensors, hybrid integrated circuits, storage chips, glass chip-based digital camera modules, and optical components.
Kunshan Qian Taike Electronics Co. Ltd. is a subsidiary of QTech Smart Vision, which was established in Kunshan to focus on high-end camera module design, manufacturing, and sales, serving clients including smart phone, IoT devices, and intelligent cars.
In 2018, the company acquired Korea-based Qian Taike and set up a subsidiary in India, Kunshan Qian Taike Electronics (India) Ltd., with the goal of achieving global resource integration.
We will now look at Dixon Technologies' basic situation. Dixon Technologies was established in 1993 and began producing color TVs in 1994. It went public in 2017 and is a leading EMS company in India, with around 20 factories and six R&D centers.
Dixon Technologies has been recognized as "the largest electronics manufacturing representative outside China" by the industry.
The main reason for choosing to merge with Kunshan Qian Taike Electronics (India) Ltd. is that, although the company is not the largest in terms of scale, it is a technology-intensive enterprise with strong client loyalty, which fills the gap in the market's mid-to-high-end demand.
Regardless of whether it is Dixon Technologies' own business needs or the Indian government's policies, they are both actively promoting the localization of high-precision components production in India.
In accordance with the Indian government's regulations, starting from 2023, India will launch a comprehensive electronics component manufacturing incentive scheme, aiming to support domestic high-precision component manufacturers.
According to this policy, if an Indian company collaborates with a foreign enterprise and the Indian side holds more than 51% of the shares and exercises management rights, it can enjoy high-level financial subsidies.
This acquisition is essentially a win-win situation for all parties involved. One, it meets Dixon Technologies' own business development needs and can obtain government subsidies; two, it meets India's goal of developing its domestic high-precision component manufacturing industry; three, Kunshan Qian Taike Electronics (India) Ltd. can maximize its value.
India's precision module industry upgrade fundamentals
Although India's electronic product exports continue to grow, most are at the assembly stage, and high-value-added components such as camera modules are still constrained by a lack of self-production capabilities.
In terms of trends, India has been actively promoting its "Make in India" and domestic component localization strategies. High-precision modules have become a key industry upgrade indicator.
From an industrial perspective, India is still at the initial stage of manufacturing high-precision modules, such as camera modules, fingerprint recognition modules, Face ID structures, laser focusing modules, micro-optical components, etc., and there are several major shortcomings:
One is the lack of a complete supply chain and core technology; two is the dependence on imported upstream materials, Indian factories lacking automation, high-precision assembly, and one-stop testing capabilities; three is the shortage of experienced personnel and technical sedimentation.
For example, the production of high-precision modules requires interdisciplinary technology fusion (optics, mechanics, electronics, software), but India lacks relevant talent reserves, with fewer than 10 years of practical experience in engineering teams, factory yields, and process replication rates are generally low.
No matter what the issue is - technology, talent, or supply chain - it becomes a bottleneck hindering India's precision module development. Dixon Technologies' acquisition of Kunshan Qian Taike Electronics (India) Ltd. can establish a technical R&D team in India, transplanting Shenzhen standards to the local market and achieving technological transfer and sedimentation.
According to the plan, Dixon Technologies will invest approximately ₹25 billion (approximately ¥210 million) to expand production capacity, aiming to increase annual output by 400 million modules. Once it is officially put into operation, it can help alleviate India's domestic supply gap, improve self-sufficiency, and reduce dependence on imports.
Currently, Dixon Technologies is a major partner for iPhone, Motorola, Vivo, etc., in Indian manufacturing. Through this acquisition, it can achieve "double-win integration" from component production to terminal assembly, enhancing supply chain thickness and risk resistance capabilities.
If this acquisition proceeds as planned, Dixon Technologies may gain relatively complete industry chains - from raw material procurement, component manufacturing, to terminal assembly - and build a closed-loop ecosystem that aligns with India's policies on high-value-added manufacturing.
This acquisition is extremely important for India's manufacturing industry in moving from assembly to smart manufacturing.
(Image source: pixabay)