The Construction of Stadium for National Games and then the commencement of IVRCL Towers and ISB at Guchibowli threw up a new location for investors to run to! Oddly named Guchibowli and its neighbouring areas like Nanakramguda, Gopanpalli became the darling of NRIs and Investors making land prices to jump from under 10Lakhs to roaring 15 Crores per acre!!

Guchibowli has already seen world class development. More organized and even, compared to Hitec City. Mammoth structures were built by Infosys, Microsoft, Wipro, Polaris, Canbay, Templeton, UBS etc. More are under construction, including 7 Star Hotel by ISTA. Also the Financial District area is seeing large scale penetration by Indian Banking Giants and FIIs to build their Data Warehouses and Emergeny Operation Centers.

US Consulate will be built in the Financial District area in Guchibowli. Already Aparna and Jayabheri are building superb Gated Townships here. Obviously, there will be demand for highend premium homes which can be rented out at 1.5 Lakhs to 5 Lakhs (within next couple of years) per Month. Emmar is building Golf Course and Villas facing Golf Course behind Infosys.

Nanakramguda is buzzing with activity. Lanco is building IT Parks, Residential Towers, Malls and Business Centers spread over 100 acres adjascent to the Express Highway which strats from Guchibowli. In addition to scores of 20 story structures, a Signature Tower soaring over 90 Floors is being built!

The silent and empty suburb of Gopanpalli, Nallagadla where the only living beings you could see couple of years back were Buffaloes and stray dogs, has awakened to Gated Bungalows costing over 150 Lakhs. Apartments at this remote location is being sold at 3000/SFT!

DLF is building Malls and Commercial Space in area Near CMC at Guchibowli. IVRCL, with its famed towers -HillRidge-(which opened for booking at 900/SFT in the year 2000), is building Multiplexes and Malls at Guchibowli. Guchibowli is rapidly transforming into a glitzy, upmarket locality.

Guchibowli- Nanakaramguda- Nallagadla -Tellapur areas are buzzing with new Projects! Aparna Shangrila, Jayabheri Meadows, Jayabheri Orange County, Jayabheri Four Seasons, Bloomfield, Aparna Sarover, Aparna Cyber County, Rolling Hills, IVRCL Hill Ridges (Apartments and Villas) etc..And many more would come up to meet the huge upcoming demand.

The Average income of tech poulation here should be above 60K per Month! Unheard of in India where the Annual average income, hardly touches Rs.5000! Obviously, Guchibowli, Kokapet, Narsingi, Gandipet, Manherevula, GopanPalli, Nallagadla, Nanakramguda should be the places that one should target for upmarket commercial ventures / enterprises. Its important to buy into developing localities and cash-out later or run commercial establishments and rake-in big bucks!

From the year 1999, the focus of buyers suddenly turned almost 100% towards Madhapur. Vijayawada Highway was forgotten! For a brief period buyers were enamored by the 4 Lane Highway thro Kompalli-Medchal. But this enthusiasm dispappered quickly. 1999 to the year 2001 saw NRIs and investors buying plots extensively in Madhapur, Kavuri Hills, Hitec City areas. By 2002, interest spread to Kondapur. Apartment and bungalow constructions commenced in full swing, in these areas from the year 2000.

By 2004, Madhapur and Kavuri Hills had run out of open space! And by 2005, entire Hitec city area, including Whitefield, was fully occupied by apartments. Several Gated Community Bungalow Layouts came up, in this stretch. Vasantha Valley, Bhavya’s, Orchid, Indu Projects etc.

The booming IT industry, caused heavy inflow of professionals into Hitec City area. And the Hyderabad Real Estate blossomed! Today( 2006-07), we can observe scores of huge IT establishments lined up behind Cyber Towers, all the way upto the Secret Lake (Durgam Cheruvu). L&T Infocity speraheaded the revolution; followed by the likes of Raheja IT Park, Acendas IT Park, TCS, Dell, Oracle, Satyam, CA, Accenture, Infotech, SQLStar, Softsol etc..

This inflow of professionals necessitiated huge housing requirement in Hitec City, Kondapur area. Premier builders like Jayabheri, Aparna, Aditya, Aliens, Nivee, Myhome, SMR. Shilpa etc. stormed in, with huge projects. Small and medium builders also joined in, building hundreds of apartment complexes all around, turning Hitec City and surrounding areas into a concrete jungle. New Projects with Refreshing designs started appering all over Hitec City Area. Foreign Companies Like, EMMAR, JURONG etc have moved in. Several others are entering the fray. Meanwhile, rapid commecial development also occured, bringing in Hotels, Hospitals, Convention Centers, Shopping Malls, Super Markets and major food chains like, Coffee Day, Barista, US Pizza, Pizza Hut, Dominos and usual bars and restaurents etc.

There are beautiful projects of Gated Villas / Homes like Aparna Orchid, Indu Projects, Bhavyas, Vasantha Valley etc near Hitec. Luxury Apartments: Jayabheri Silicon County, SMR Technopolis, My Home Navadweepa etc. Several Residential Towers were under planning stage as of December 2006.

Arterial roads from Jubilee Hills got opened up. Once quiet, Jubilee Hills has now awakened to buzzing horns and traffic jams!

BETTING on the booming electronics market in India, SemIndia is foraying into manufacturing of consumer-related electronic products like modems, wimax terminals and set-top boxes for the domestic market. SemIndia Systems, a wholly-owned subsidiary of the company formed last year, has now begun to ship its first product - an ADSL modem.

Vinod Agarwal, chairman of SemIndia said, “Our manufacturing of such products was part of our initial plan. We want to exploit the fact that the Indian domestic market for consumer related electronic products is increasing exponentially. So we will be making products such as modems, Set-top boxes and Wimax terminals.”

According to the SemIndia chairman, the unit has engaged Flextronics in Chennai to manufacture the products. Currently, the company is shipping its first product - an ASDL Modem, under its brand name to telecom major Bharat Sanchar Nigam (BSNL). The next product would be a wimax terminal to be launched soon, he added. SemIndia sees significant potential in demand for set-top boxes, wimax terminals and modems - an average demand of 5-10 million units in India per year.

SemIndia Systems bought a substantial stake in Bangalore-based chip design company Xalted recently, the value of which Mr Agarwal declines to comment on. The subsidiary thus starts out with about 100 design engineers who are working on designs for the products. “Most of the products, for example modems, come from countries like China. These are not meant for the Indian conditions which has lot of glitches in electrical supply, so the products don’t last beyond a few months. We have designed products with better power supply designs for the Indian market, which we would offer at price points on par with those currently in the market,” he said.

“We want to create an entire semiconductor ecosystem. Our $100-million assembly-test-mark-pack (ATMP) plant in Hyderabad, which we will start building soon, should be ready for chip production in two years. Chips manufactured here after two years, will be used in the boxes assembled in Chennai. In the meantime, we are designing electrical systems,” Mr Agarwal added.

According to a ISA-Frost & Sullivan report, total consumption of electronic equipment in India would reach $363B by 2015 at a growth rate of 29.8% from just $28.2B in 2005. This would push the total market for semiconductors at $36.3B by 2015 and increase the industry’s contribution to GDP from 2% currently to 12% in 2015.

-ExclVentures

Telecom minister Dayanidhi Maran on Thursday announced a capital subsidy of up to 25% to attract investments from global majors for setting up semiconductor fabrication and other micro and nano technology manufacturing units. With this move, investments of $6-9 billion in the near future appear a distinct possibility.

The semiconductor policy had been approved earlier by the Cabinet, which will be operational till 2010. The subsidy offered is in the form of tax breaks and interest-free loans. “A typical fabrication unit requires a minimum $3 billion investment. Our country has the eco system to absorb at least 2-3 such units,” he said. Semiconductor companies eager to invest a minimum of Rs 2,500 crore, can get a benefit of 20% of the capital expenditure during the first 10 years, if located in an SEZ. If located outside an SEZ, the benefit is 25%, with countervailing duty on capital goods also been removed. The threshold investment limit for manufacturing other products like storage devices, micro and nano technology products, assembly and testing of all these products and Organic Light Emitting Diodes is Rs 1,000 crore.

The policy comes late, long after the world’s largest chip maker Intel turned its back on India to invest in Israel. The incentives offered are for the manufacture of all semiconductors, displays including Liquid Crystal Displays, Plasma Displays as well as other such panels including solar cells and photvoltaics.

MAIT, the hardware industry association, welcomed the policy saying it has met industry expectations.Urging the states to frame investmentfriendly policies for such companies, Maran said the Centre would also support cluster technology which has done well in China. “Government has got good inputs from the Investment Commission to create clusters. The Department of Information Technology will be working with state governments to develop cluster technology,” he said. “We have rolled out the red carpet and are welcoming companies to come and invest in India in semiconductors or other related products. Many MNCs are in talks with us. They are eagerly waiting for this policy,” Maran said. Giving an example, he said: “We export Silica and companies outside India make poly and mono-silicon chips out of this. During my visit to the US, I saw many such companies”. 

Comment: The Policy has been hailed as path breaking. Its likely to create a semiconductor revolution, similar to the software industry explosion which commenced with economic liberalization and STPI incentive scheme, 15 years back. The policy allows for double benefit. Fab units under SEZ like Fabcity on Srisailam Highway, will get 20% Capital Subsidy as well as all Operational tax benefits under SEZ Policy! What more you need to kick start the boom ?.        

THE government on Thursday announced the long-awaited semiconductor policy. Till now, India has been designing chips, in over 100 chip design units, for the world — for products like iPods, set-top boxes, LCD TVs and cellphones — while countries like China, Taiwan and Singapore manufactured the India-designed chips. The new policy promises sops for companies to set up fab units (jargon for chip manufacturing plants) in India. Whether global semiconductor giants will actually set up fab units in India remains to be seen.

India is the fastest-growing market for electronic products with the use of electronic goods expected to grow to $363 billion by 2015 from $28 billion in 2005. India is expected to account for 11% of the global electronics market by 2015, compared to 1.8% in 2005. And, these digital products will consume semiconductors to the tune of $36 billion by 2015, says the Indian Semiconductor Association. This may make a compelling case for companies like Intel, AMD, Infineon, Toshiba, IBM, SemIndia and others to establish manufacturing units and avail the 20% subsidy for semiconductor plants in SEZs and 25% for those located outside SEZs, as per the policy announced on Thursday.

The incentives will be in the form of tax concessions, interest subsidy and interestfree loans for subsidising the capital expenditure incurred in setting up the manufacturing units for the first 10 years of its existence. Thus, a unit set up in 2010 (the policy is valid till then) would receive subsidies up to 2020.

Announcing the package for semiconductor fabrication and other micro and nanotechnology makers, IT and communications minister Dayanidhi Maran said that the government has rolled out the red carpet for big companies. “Earlier, we lost to Vietnam and Israel because of the absence of a policy,” Mr Maran said. Vinod Agarwal, founder, chairman & CEO, SemIndia, said: “We are excited that the government has taken a step in the right direction at this crucial juncture. This policy announcement will give a major filip to hi-tech manufacturing in the country which can become a singnificant contributor to the Indian economy.’’

Mr MARAN added that large companies have already approached the government evincing interest and the policy could attract $6-9 billion investment in fabrication units. The package, which is over and above the incentives offered by the various state governments, can be availed up to 2010. As of now Andhra Pradesh is leading the race for creating an ecosystem for semiconductor players. The minimum investment for availing the incentives for semiconductor manufacturing has been pegged at Rs 2,500 crore, while the threshold for other products like LCDs, organic emitting diodes, plasma panels, storage devices, photovoltics and other advanced micro and nano products assembly and testing is Rs 1,000 crore.

Asked if the company would establish a manufacturing unit in India following today’s announcement, an Intel spokesperson said: “Once a comprehensive policy document is circulated, we will evaluate and respond.” While Alok Ohrie, MD, AMD India, said: “We are very pleased that government has taken a step towards jump starting high-tech manufacturing . This move has the potential to change the course of IT industry in the country. AMD reaffirms its commitment to stand by SemIndia by offering technology for the proposed fab.’’

ST Microelectronics (STM) which has a 1,700-people strong design centre in India says that there is already an overcapacity of chip making units. Vivek Sharma, VP, STM India design centre, said: ”We have enough capacity for the next five years. Also, the future could be fablite companies (that is, companies like STM will design chips and outsource manufacturing ).’’ Nonetheless, many companies could come calling considering the opportunity that the domestic market offers. 
Comment: AMD has reaffirmed its commitment to Semindia. The policy may draw in several other large companies into Fabcity on Srisailam Highway, making the locality bloom into vibrant international Tech City.      

 www.exclventures.com

Hyderabad: The second edition of the India Semiconductor Association-organized Vision Summit commenced in Hyderabad, the capital city of Andhra Pradesh today.

Andhra Pradesh chief minister YS Rajasekhar Reddy inaugurated the two-day event at a city hotel. The two-day event has seen the participation of more than 300 delegates from eight countries

Dr.Reddy in his inaugural address said that Andhra Pradesh is committed to make Hyderabad the semiconductor capital of India. He announced that the much-awaited Fabcity being planned in Hyderabad has been given pollution clearance.

Mr Reddy assured to provide the best of infrastructure for semiconductor companies and invited them to start their operation from the State.

Vandana Shenoy, president India Semiconductor Association (ISA), MM Pallam Raju, union minister of state for defense and West Bengal IT minister Debesh Das were also present on the occassion.

A national directory of semiconductor companies was also launched on the occasion by Reddy. The ISA-EYI study on the global competitiveness of India in the semiconductor design industry would be released tomorrow.

-Andhra Cafe

DNA : Monday, February 05, 2007  23:59 IST

IP-driven model puts firm with $3bn chip fab plan on aggressive acquisitions path

Experts continue to debate the logic of setting up a chip foundry in India. But SemIndia, which is working to set up a $3 billion silicon wafer fabrication unit here, has charted out an aggressive M&A path for itself in the global semiconductor space, and thereby create an intellectual property-driven business model.

As a first step towards this SemIndia has recently acquired Bangalore based fabless semiconductor company Exalted Networks in an $8 million cash and stock deal, a source close to the investors said.

The SemIndia consortium, promoted by former McGill University don Vinod Agarwal, includes the world’s second largest chip-maker AMD, fabless ASIC semiconductor design and manufacturing giant Flextronics, private equity fund Sandalwood Partners among others.

Significantly, it has kicked off parleys with global private equity funds to raise the money for acquisition of Assembly, Testing, Marking and Packaging (ATMP), plants and fab units across the world, Ajay M Marathe, chief operating officer, SemIndia USA Inc, said.

Marathe, till recently president of AMD India, is slated to take charge formally on February 12 as the COO of SemIndia.

He refused to divulge the extent of these investments, but said the local fab will cater to the domestic market, while the overseas fabs, which could be ultimately shifted to India, would initially cater to customers abroad.

A source close to the investors said while SemIndia may not buy old fabs and will focus only on acquiring new equipment, it was nevertheless scouting for ATMP units in Thailand, Malaysia, Singapore and Taiwan.

These acquisitions will be in the range of $100-200 million and there could be at least three such deals.
SemIndia kicked off work on a $100 million ATMP unit in the FabCity complex here and expects to commission it by the end of the current calendar year.

The FabCity is also promoted by SemIndia which wants to tap the huge potential market for outsourced ATMP services from global chip makers. Testing and packaging constitutes between 25-35% of the cost of the chip and is a major cost factor in chip making.

Exalted Networks has now been rechristened SemIndia Systems Pvt Ltd, and has 100 engineers working for it. The company is expected to close the current financial year with a turnover of Rs 100 crore.

Interestingly, it has already started marketing third-party products with the SemIndia brand in the country. It has shipped out the first batch of ADSL modems made by co-investor Flextronics to BSNL. SemIndia is close to closing two similar deals as Exalted, he added.

However, he did not name the target companies. Further, it is understood that AMD, which is till now a technology partner in the $3 billion wafer fabrication unit, will pick equity pari passu with the government.

How much this will be therefore depends on the fine print in the National Semiconductor Policy (NSP), cleared in-principle by the Union government.

The industry has demanded between 25-26% equity participation by the Centre apart from a host of other sops.

But sources close to the Andhra Pradesh government said the state was willing to kick in its own equity participation if Centre only partially or even does not agree to the 25%-26% equity participation

While Sandalwood Partners and Flextronics have picked up 5% each in the project totaling to $20 million, main promoter and former McGill University don Vinod Agarwal hold the remaining. AMDs investment could therefore work out to roughly $50 million if the government were to agree to pick up around 25% equity in the project.

“SemIndia will never be a classic foundry as it will be mainly IP driven with innovative products as the main focus”, Ajay Marathe said elaborating on the company’s business strategy. “That is why it will go around buying up product design IP”, he added.

3 ATMP units in far-east on radar
SemIndia to private equity funds for raising money for ATMP and fab acquisitions

It may buy 3 ATMP units worth $100m -$200m each located in Thailand, Malaysia, Singapore or Taiwan

- AMD to be pari passu equity participant with government

- AMD India chief Ajay Marathe to be COO, SemIndia

- Andhra may pick up equity in SemIndia project

TIMES NEWS NETWORK[ SUNDAY, FEBRUARY 18, 2007 01:14:23 AM]
 
The real estate boom in Hyderabad has definitely hit the city late compared to IT meccas like Bangalore or Chennai. Nevertheless, the quantum of growth has been substantial enough to make some of the biggest property developers in the country sit up and take notice. Realty majors like DLF and Unitech of Delhi and Hiranandani of Mumbai have either already announced projects or are planning property development in Hyderabad.

Like in most metros, IT/ITeS growth is both commercial and residential property segment in the city. Software players like Satyam, Microsoft, Infosys and Google have huge development centres in Hi Tech City and Gachibowli. With excellent roads, connectivity and proximity to the upcoming international airport at Shamshabad, HiTech City and Gachibowli are no longer city fringes. They are, in fact, commanding a premium. Property prices in the region have also shot up quite significantly and are quoting at around Rs 4,320 per sq.ft, as high as rates in the central business districts.

To cater to the IT population, a number of property developers have also announced new residential properties in these regions. The region opposite HiTech City, Kukatpally has been developed by the city administration with good roads ensuring connectivity. As a result, Kukatpally is today the hottest destination for residential property development in Hyderabad city.

Since they ensure good connectivity to the CBDs and are far from the noise and pollution of the city, these townships in the outskirts of the city are becoming popular with buyers. “Few years back, travelling 20 kms away from the city would be a nightmare. Now with good roads and highways, travelling outside city limits is no more an arduous task making townships a good option,” says Anshuman Magazine, managing director of real estate consulting firm, CB Richard Ellis

Earlier, the posh Banjara Hills and Jubilee Hills region of the city were considered the outskirts of Hyderabad.

Today with development reaching as far down south as Shamshabad, about 40 km from the CBD, the center of gravity is expected to shift towards that region. Apart from the prestigious $3 billion Fabcity project announced by SemIndia, Shamshabad will also have a number of SEZs, commercial and residential properties all amounting to a total investment of Rs 30,000 crore, if things go as planned.

A number of airport related projects like top hotels, convention centers, ring road, a seven-star hotel with golf course proposed by Emaar Group and the Fabcity project together will make Hyderabad the destination to conduct business, say industry experts.

The state government has also provided fillip to the real estate growth by periodically conducting auctions of litigation-free, government land through Hyderabad Urban Development Authority (HUDA) that ensures developers transparent, hassle free land transactions with clear deeds.

Residential property business in Hyderabad has also been witnessing dizzy heights with many new villas and luxury condominiums being planned.

Hyderabad, which is already known for its lavish bungalows, will also now house the most expensive villas. Property developer Omega Shelters is planning huge Spanish Villas in the outskirts of the city that come with a price tag starting from Rs 4 crore and going up to a whopping Rs 12 crore.

Retail sector is also driving the real estate demand in a big way. Reliance Retail, which made its grand beginning in the city, has already opened 21 outlets in the city. Besides established retail players like Future Group, there is a huge accent on mall development, specialty stores, entertainment plazas and resorts on the city outskirts. While the large retail players gobble up spaces in high streets and main roads, smaller players take to bylanes and streets adjoining main roads, resulting in real estate demand in those spaces too. 

HYDERABAD: Finally the semiconductor policy is out. SemIndia, quite obviously, will have the widest of smiles.

After overcoming initial hitches, SemIndia seems to be looking up. Reports on the company roping in new investors augurs well for its dream project – the $3 billion Fab City venture, a microprocessor and silicon chip manufacturing facility.

The company is ramping up its senior managerial team. Its commitment to ready the Assembly Testing Manufacturing and Packaging plant in 13 months indicates that it is in the comfort zone.

Before the announcement of the semiconductor policy, George A Shaw, the president and managing director of Assembly and Test of SemIndia, spoke to CyberMedia News about the future of the plant being built in the outskirts of Hyderabad.

With the first building of the plant in design, Shaw is already speaking about the growth of the plant, which he is heading. “The factory over the next two years would grow to about 1500-2000 people.

Shaw, who joined SemIndia recently, is a veteran in the industry with 30 years of experience.

He added that if necessary, the company also has plans to build a second plant in the future. And if the second factory sees the light of the day then Shaw’s assessment is that the plant could well become 4000-5000 strong in the next five-six years.

SemIndia recently received the environmental clearance for the Fab City project. Construction for the plant would start within a month or two.

To build the team, the manufacturing plant is roping in professionals from Malaysia, Singapore, Taiwan and China.

“We are able to attract a number of key individuals who are currently working in other countries like Malaysia, Singapore, Taiwan and China. They are core team leaders,” said Shaw.

The Fab City will also have a training facility. About three-four months’ training will be imparted from the facility, informed Shaw. AMD will also come into play with training facility besides providing technology transfer.

Shaw thinks that infrastructure poses a big challenge for the project but is confident that it would be overcome.

“We are working with the State government and they are bringing in new water lining dedicated to Fabcity. They are constructing sewerage system to drain the water properly,” said Shaw.

“Currently we are working with them on the power supply. This is another difficult area with the quality of electrical power. We would be getting the power, but even then we have to do some power conditioning,” he said.

Shaw also confided that a significant challenge he faces is to understand the officials.

– CyberMedia News

HYDERABAD: Fab City, the semi-conductor facility proposed to be established near Hyderabad with a projected investment of $3 billions, has received the crucial environmental clearance, according to Chief Minister Y.S. Rajasekhara Reddy.

Inaugurating India Semiconductor Association’s (ISA) two-day `Vision summit’ here on Monday, the Chief Minister urged entrepreneurs from the semiconductor and electronic sectors to set up manufacturing units in the State, promising infrastructural support. The Centre is expected to unveil the Fab policy in a couple of weeks.
 
Mr Reddy pointed out that Hyderabad is the emerging semiconductor capital of the country and added that an additional capacity of 7,000 MW would be installed in the next two to three years to meet the requirement of the growing semiconductor industry.
 
Minister of State for Defence M.M. Pallam Raju said the electronics equipment consumption was expected to grow to $363 billion by 2015 with the semiconductor consumption being $36.3 billion.
 
The minister pointed out that as the world is headed towards increasing usage of high-end electronics in security and surveillance in weapons, missiles in space and network-centric warfare, it would spur the growth in the industry. The absence of domestic semiconductor manufacturing highlights a significant imbalance between design and manufacturing and needed to be rectified, he noted.
 
West Bengal IT Minister Debesh Das said semiconductors would rule the world in the coming days and emphasised the need to make India self-reliant in the sector.Rajendra Kumar Khare, ISA Chairman, said one-third of the country’s GDP would be contributed by the semiconductor industry by 2015 and the same is expected to create more jobs in comparison to IT and ITES.
 
Executive Director of the Fabless Semiconductor Association Jodie Sheldon said that the design and platform approach adopted by semiconductor industry is expected to provide advantage to India over China. In three years it would transform drastically and consolidate in supply chain management.