Tata Electronics has acquired a 60% stake in Pegatron’s Indian unit, which operates an iPhone manufacturing plant in Tamil Nadu. This acquisition follows Tata’s earlier purchase of Wistron’s operations in Karnataka in March 2024, reinforcing its growing presence in the Apple supply chain. The financial terms of the deal remain undisclosed, but the move positions Tata Electronics as a key Apple supplier alongside Taiwanese manufacturers like Foxconn.
Approval from the Competition Commission of India
On January 7, the Competition Commission of India (CCI) gave its approval for Tata Electronics to take a majority stake in Pegatron Technology India. The approval also includes the business transfer of TEL Components, Pegatron’s 100% owned subsidiary, to the Indian unit. TEL Components is setting up a greenfield facility for smartphone electronics manufacturing, further strengthening Tata Electronics’ position in the market.
Pegatron’s Role in iPhone Production
Pegatron Technology India’s Chennai facility contributes approximately 10% of India’s iPhone production, with an annual capacity of five million units. The facility employs about 10,000 people and exports products to Apple’s global markets in North America, Asia, and Europe, while also catering to the Indian market. As part of the acquisition, Tata Electronics and Pegatron will merge their teams, with Pegatron India set to undergo rebranding to reflect the new ownership structure.
Challenges and Strategic Growth
The acquisition comes after several quarters of negotiations between Tata Group and Pegatron, as the latter sought a local partner to overcome challenges related to profit margins and workforce management. Pegatron’s Indian unit was also affected by worker unrest in late 2020, a situation that led to property damage and attacks on senior executives.
Tata Electronics’ Broader Strategy and Expansion Plans
Beyond its partnership with Apple, Tata Electronics is diversifying its business. The company is in talks with Chinese smartphone manufacturers, including Xiaomi and Oppo, to produce components and expand its portfolio, similar to Foxconn’s business model. Tata Group’s recent ventures into electronics, semiconductors, healthcare, and battery manufacturing aim to strengthen its position in these critical sectors, responding to supply chain disruptions and market demands during the Covid-19 pandemic. These expansions are viewed as key drivers for the group’s future growth.
