Hero Electronix Eyes $150M Stake Sale in Semiconductor Firm Tessolve Amid Booming Chip Demand

Hero Electronix, backed by Suman Kant Munjal, plans to sell 25-30% of its stake in Tessolve, a semiconductor design and engineering company based in Bengaluru, to capitalize on strong investor interest in the chip sector, according to sources. Munjal, who also chairs Hero Group’s Rockman Industries, is looking for $120-150 million (about ₹1,000-1,260 crore) from the stake sale, valuing Tessolve at approximately $400-450 million (₹3,300-3,800 crore).

Key Details of the Stake Sale

Tessolve, which reported revenues above ₹1,000 crore last year, is not currently fundraising, according to its CEO Srini Chinamilli, who noted the company’s healthy financial growth with a 20% annual growth rate in recent years. Tessolve’s projected EBITDA for FY25 is $20 million, and the company’s value is pegged at 20 times this figure.

Hero Electronix owns around 58% of Tessolve, with other shareholders including Singapore-based Novo Tellus Capital Partners (32%), Tessolve cofounder Raja Manickam, Qualcomm Ventures, and angel investors.

Expansion and Strategic Acquisitions

Founded in 2004, Tessolve supports 80% of the top 20 global semiconductor companies with end-to-end solutions, from design to testing and production. It has over 3,000 employees spread across 10 countries, including the US, Germany, Canada, Japan, and the UK. Hero Electronix acquired Tessolve in 2016 and has since overseen several acquisitions to boost capabilities, including Bengaluru’s Pico2 Femto Semiconductor in 2022 and Test & Verification Solutions (T&VS) in 2020.

Tessolve plans to expand its facilities in India and internationally and is close to acquiring a European company, with details expected soon.

Semiconductor Market Growth in India

India’s semiconductor industry is expected to grow 20% annually, reaching $80.3 billion by FY28. The Indian government’s Semiconductor Mission (ISM), launched with a ₹76,000 crore fund, is attracting global investments and supporting projects that bolster India’s position in the semiconductor industry.