Bengaluru-based electronics manufacturing startup Zetwerk aims to start manufacturing servers locally next financial year and is expanding its laptop production capacity in the country to contract manufacture the devices for global brands, co-founder Rahul Sharma said.
The company, set up in 2018 and which counts IndiGo co-founder Rakesh Gangwal among its investors, is close to establishing partnerships with entities in Taiwan, Japan and South Korea to venture into manufacturing of automotive electronics and charging infrastructure for electric vehicles (EVs) and electronics used in defence equipment. It will soon begin providing new facilities in India as it aims to create the partnerships in the next six months.
“Our mission is to be in the key industry segments and tap into the ‘Make in India’ opportunity in the electronics sector, which we believe is a once in a lifetime opportunity. Supply chains move every few decades, this time they are moving to India, and we want to leverage this with the help of government policies to become one of the companies that can create a name for ourselves in the sector,” Sharma said. Mint In an interview.
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“In the next two quarters, MoUs will be signed with global companies in Korea, Japan and Taiwan, through which we will enter new sectors of automotive and defence electronics. In the next fiscal year, we are considering manufacturing servers locally and will also expand our laptop manufacturing capacity. We are already in talks with brands for manufacturing laptops,” he added.
The contract manufacturer operates four of its own manufacturing units, besides outsourcing production of mobile phones and laptops to other vendors. It is an original design manufacturer for televisions, tablets, personal computers, hearing devices and wearables. It has recently expanded its manufacturing facilities through a strategic partnership with electronics manufacturing services company Smile Electronics to set up three IT hardware manufacturing facilities in Bengaluru, Chennai and one in Andhra Pradesh, which is expected to be completed early next year.
Automotive electronics will include components for electric vehicles and charging infrastructure for state-owned oil companies Indian Oil Corp. Ltd and Hindustan Petroleum Corp. Ltd, while defense electronics will be components used in manufacturing defense hardware.
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Sharma added that investment in diversification into new segments would be part of the ₹The company has earmarked Rs 1,000 crore for expansion in the electronics sector across all segments. Sharma said that with its revenue expected to grow 20-30 per cent in fiscal year 2024 (FY24) compared to FY23, the company was well-funded with a healthy mix of debt and equity and hence would not require fresh investments for some time. The company has raised $650 million till date, including a recent $20 million round from Gangwal.
However, the company could take advantage of the new set of incentives that the government is planning for electronic component manufacturing. “Incentives through phased manufacturing programme and production-linked incentives (PLI) would help startups, but the incentives should be given in proportion to the investment and efforts put in by the company,” he said.
Zetwerk’s manufacturing facilities in the US, Mexico and Europe will complement its Indian factories, enabling it to export to global markets.
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