On October 7, shares of CG Power and Industrial Solutions rose over 1%, reaching Rs 729 in morning trade. This increase follows the company’s announcement of a definitive agreement to acquire the radio frequency (RF) components business from Renesas Electronics Corporation for $36 million, marking a significant step into semiconductor design.

The RF components segment, part of Japan-based Renesas, generated revenues of $56 million in 2023. Through this acquisition, CG Power will gain:

● Intellectual Property: Valuable patents and proprietary technologies related to RF components.

● Equipment: Machinery and tools essential for the production and design of RF components.

● Inventories: Existing stock of RF components.

● Select Employees: Key personnel from Renesas to maintain expertise in RF design and marketing.

A new subsidiary, CG Semi Pvt Ltd, has also been established to oversee Outsourced Semiconductor Assembly and Test (OSAT) operations.

Vellayan Subbiah, Chairman of CG Power, highlighted the strategic importance of this acquisition, noting that many top global semiconductor designers are based in India. He believes this move will enhance India's standing in the high-growth semiconductor design sector.

Davin Lee, Senior VP of Renesas, stated that the acquisition presents an opportunity for its RF team to grow, allowing the company to focus more on its analog and connectivity business.

In March 2024, CG Power announced a joint venture with Renesas and Stars Microelectronics to create an OSAT facility in India, reinforcing its commitment to the semiconductor industry. This collaboration has contributed to positive market sentiment, reflected in the recent rise in CG Power’s shares.

As of approximately 9:20 AM, CG Power shares were trading at Rs 725, up 1% from the previous close on the NSE. Notably, CG Power and Industrial Solutions shares have surged by 60% since the start of the year, signaling strong investor confidence in the company's growth potential.