In what is expected to be a major boost to PM Modi’s Atmanirbhar Bharat vision, the South Korean electronics giant’s display arm (Samsung Display) has started production of OLED panels for smartphones at its Noida facility from this month. The company will soon ramp up production to make IT display panels as well. It started the work on the mobile display unit as it would help save on import taxes in India. The display project is a relocation of Samsung’s China display manufacturing operations which the company has slowly been shutting down since last year.
Samsung Display recently got success in developing an OLED (organic light-emitting diode) panel technology that can drastically reduce smartphone power consumption. The key to this new technology is to reduce overall power consumption by automatically adjusting the display refresh rate (frames per second) according to the usage environment. Panel drive power can be reduced by up to 22% compared to existing smartphones.
This is the first time any display manufacturing is being done in India and bolsters India’s hopes to become a global hub for smartphone manufacturing. This move is said to offer jobs to 500 people directly and to about 1,300 people indirectly.
“The move will give confidence to smaller players in the broader display ecosystem to come to India and set up operations. Samsung is one of the largest players. It gives a signal to the overall supply chain that this component is ready for manufacturing,” said Tarun Pathak, associate director at Counterpoint Research.
Pathak said display is going to be more critical for mobile phones, tablets, and consumer Internet of Things devices. “This means that the contribution of local sourcing will increase. The display is a high local value-added product with a 15-18% price contribution towards a smartphone cost. Not all will be sourced in India but it is a good starting point. It needs to be seen at which level Samsung is building the unit and preparing for production since there are certainly other components involved, said Pathak. “With the PLI (production-linked incentive) scheme, the local value addition can hit 25-30% over a period of time, from 12-13% presently,” he added.
Samsung makes more than 70% of the total display products used across the world in TVs, mobile phones, tablets, and watches, among other gadgets, in South Korea, Vietnam, and China. Beijing BOE Display Technology, Tainma, LG Display, and JDI are some other prominent display makers.
The Uttar Pradesh government had approved special incentives for Samsung Display Noida, which has invested Rs 4,825 crore to relocate its mobile and IT display production unit from China to the state, giving a boost to India’s bid to expand local manufacturing, especially at the cost of its far east Asian neighbor. Samsung will get about 250 Crores INR from the state UP govt as financial provisioning for this project for 5 years and about 460 crores INR from the Centre’s Scheme for Promotion of Manufacturing Electronic Components and Semiconductors.