Tamil Nadu closes year 2024 on an investment high

CHENNAI: Competition among states to earn the best investment destination tag has always been intense but what sets Tamil Nadu apart is the flavour of industries – yes, from helmet makers to green energy to chip manufacturers to mobility players to lift producers and more. The investment spread is so diverse and distributed that it highlights the state’s ability to attract marquee investors from all corners of the world. For instance, look at Geneva-based XyloSuisse which is setting up the first manufacturing unit in India, which is under construction at Thoothukudi. And what is unique is TN will soon be housing India’s first International Furniture Park. Having said that, another unique destination is Ranipet, which will, in 1.5 years, roll out the Jaguar-Land Rover for the world. With an initial investment of Rs 914 cr, the production capacity has been fixed at over 2 lakh units initially on a built up area of 52,000 sq m (471 acres).

2024, therefore, has been quite a year with investments coming across diverse sectors with particular emphasis on green energy, electronics and mobility marking TN’s industrial landscape. Starting from the global investors meet that was held in Chennai in the beginning of the year, visits thereafter by chief minister MK Stalin, along with his investment marketing entourage to the US and Spain, among other countries, have resulted in signing up mega deals this year. The stellar investors include VinFast EV manufacturing plant ($2 bn in Thoothukudi, capacity 50,000 cars per annum, built up area 97,000 sq m, phase I area 114 acres, will have assembly workshop, paint shop and test track, jobs for 3,500 people), Tata Electronics Mobile Assembly ($1.45 bn), Tata Power Green Energy ($6.6 billion), Hyundai Motors EV initiatives ($739 million) and Pegatron Apple Production ($120 million).

This month has been spectacular with the pace of investments reaching a crescendo of sorts as German engineering major Schwing Stetter formalised its plan to invest Rs 600 cr in Cheyyar Sipcot to set up its fifth factory in TN, that will provide employment to 1,000 people, on a built up area of 2.47 lakh sq ft. (allotted 52 acres in Sipcot).

The investment cauldron has been filling up in such a manner that there are already talks of a probable Foxconn city on the horizon! Foxconn's $230 million township project in Chennai, to accommodate nearly 18,000 workers (mostly women), is complete, indicating the rapid manner of the Taiwanese major expanding footprint in India. On the cards is a Rs 13,000 cr display unit, massive battery storage plant and several townships in TN.

Next is the branded helmet manufacturer Steelbird, which is planning to build a Rs 250 cr greenfield facility at Hosur, while Greaves Electric is laying the ground for establishing a battery assembly line in Ranipet by 2027. TCS is to set up a new office (SEZ unit) at Ozone Tech Zone on OMR, which would mean an employment potential for 5,000 people. Another diverse investment case is that of HFCL, which inaugurated its advanced defence manufacturing facility in Hosur. This produces cutting-edge thermal weapon sights (5,000 per year), electronic fuzes (2.5 lakh electronics fuzes/year), 1,000 units of HCRR and HCRR and surveillance radars annually.

Other notable developments include Taiwanese laptop maker MSI, which commenced manufacturing operations in India with its first facility in Chennai. Ola Electric is to further invest Rs 2,200 cr in FY25 for expansion of its lithium ion cell manufacturing facility at Pochampalli Sipcot to take its capacity from 1.4 GWh to 5 GWh. Non-leather athletic footwear Taiwanese company Hong Fu has been allotted 170 acres (2 plots) and it has committed to invest Rs 1,500 crore that would mean employment opportunities for 25,000 people (85% rural women) at Panapakkam. No wonder that Sipcot has signed an MoU with Ficci Flo Chennai, for starting the first-of-its-kind crèche facilities in 17 Sipcot industrial parks that would cater to 3.23 lakh working moms. After all, TN is already home to almost 43 per cent of women working in India's factories.

Incidentally, in November 2024, TN hit the $1.533 billion electronics goods exports, the highest so far. It has emerged as a top leading state for 8 months of FY 24 with TN garnering $7.82 bn (37.7%), Karnataka $4.14 bn (19.9%), UP $3.46 bn (16.7%). In fact, TN is expected to close FY with $11 bn plus exports.

The global capability centres too have seen substantial growth, with engineering talent and competence luring investors and marquee brands from the globe. Therefore, the radial road now is studded with brands such as Walmart (3 lakh sq ft deal with CapitaLand at Pallavaram), Wells Fargo, BNY Mellon, Accenture, Vestas, Shell even as State Street which has operations in Coimbatore readying itself to flag its presence in Chennai. Global automotive tech major Aptiv has also invested $45 million in India as it announced expansion of its plant capacity for SDV cockpit solutions in Aug even while inaugurating its second Indian engineering centre (GCC) in Chennai earlier this month. The US-based Equinix is also expanding its data centre at Siruseri with a new investment Rs 866 cr apart from doubling from its existing 18,465 sq m to 42,051 sq m on 5.94 acres.

DISTRIBUTED SPREAD

· Hyperloop first test track (410 m) developed by the IIT-Madras research park along with other stakeholders such as the Railways and TuTr

· Tata Voltas new AC manufacturing plant at Mannalore Electronics manufacturing cluster in Gummidipoondi (150 acres, Rs 500 cr phase I investment, 1,500 jobs)

· AET Displays, part of China's Guangda Group, is investing Rs 200 cr to set up an assembly line cum warehouse in Chennai

· TN has also sanctioned a grand library and intellectual centre in Tiruchy for Rs 290 cr.

· FMCG Dabur for plant at Sipcot food park in Tindivanam, investment of Rs 400 cr, employment to 700 people

· Vikram Solar to expand upcoming solar cell and PV plant in Tirunelveli, with an investment of Rs 3,007 cr, employment 4,000 people on 187 acres (28.09 lakh sq ft)

· Li Energy plans to set up 10 GWh Li-ion cell manufacturing unit in Chennai - phase one of 1.1 GWh to be ready by 2026

· French IT major CapGemini leases nearly 1.4 lakh sq ft at the new Elcot IT tower. It already employs 12,000 people in TN; expanding Chennai campus with 6,000 people

· Infosys expanding big in Coimbatore’s SVB Tech park

· US KBR opens 3rd office in Millenia Business Park in Chennai

· Consulting giant BCG doubles footprint in Chennai

· Taiwan-based footwear manufacturer 'Dean Shoes' (Free Trend) Rs 1,000 cr plant proposed at Ariyalur - 15,000 jobs

· Bagmane group - 5.23 acres (2 plots) and Equitas Bank - 2.82 acre (1 plot) for fintech city at Nandambakkam

· Mall of Madras at SPR city, Perambur - 1.2 mn sq ft 5 floor, 300 shops, 12 anchor shops, 9 screen PVR multiplex