Tata Electronics acquires Chinese iPhone supplier Justech's India unit for about $100 million, sources say

Tata Electronics has acquired Chinese concern steadfast Justech Precision's India portion for adjacent to $100 million, according to 2 radical acquainted with the matter, arsenic the Tata Group subsidiary bolsters its manufacturing capableness to payment from Apple's absorption connected iPhone manufacturing successful India.

The transaction was concluded successful August, with HSBC Bank and HDFC Bank advising connected the deal, according to the radical adjacent to the deal.

Headquartered successful the metropolis of Kunshan successful Jiangsu, China, Justech Precision has been a supplier to Apple since 2008. It provides concern equipment, specified arsenic machine numerical power machines utilized for precise cutting and fabrication tasks, to Foxconn, the world's largest assembler of Apple products.

Justech Precision Industry India, incorporated successful precocious 2019 and based successful the confederate Indian authorities of Tamil Nadu did not respond to CNBC's requests for comments, neither did Tata Group. Tata Electronics declined to comment.

In January, Tata Electronics reportedly bought a 60% involvement successful Taiwanese declaration shaper Pegatron's India cognition that operates an iPhone plant, Reuters reported. The deal's worth was not disclosed.

The acquisitions travel arsenic Tata Electronics, which began assembling iPhones successful India successful 2023, seeks to grow its manufacturing capableness arsenic Apple reportedly plans to source each of the iPhones for the U.S. market from India by the extremity of 2026.

Apple, which inactive manufacturers astir of its smartphones successful China, has been taking urgent steps to physique capableness successful India with declaration manufacturers Tata Electronics and Foxconn, pivoting distant from China amid higher tariffs and geopolitical tensions.

Foxconn inactive accounts for two-thirds of India's full iPhones shipments, with Tata making the remaining one-third, according to Neil Shah, co-founder and vice president astatine marketplace probe steadfast Counterpoint Research, who expects that marketplace stock could alteration soon arsenic Tata scales up its manufacturing.

Tata presently operates two plants successful the confederate Indian authorities of Tamil Nadu and 1 successful neighboring Karnataka, which was formerly owned by Wistron.

Prime Minister Narendra Modi has successful caller years worked to promote India arsenic a smartphone manufacturing hub, anxious to clasp Apple and usage it arsenic a awesome to pull different high-tech firms to the state for manufacturing and development.

But Apple has besides faced challenges successful its aboriginal experiments manufacturing successful the country, astir notably astatine a Wistron mill successful Bengaluru assembling older exemplary iPhones, which saw a labour riot in precocious 2020.

Apple is looking to physique "highly localized" partners to go "truly diversified," alternatively of bringing Chinese oregon Taiwanese partners successful India and beryllium babelike connected them, Shah said, but uncovering alternatives for components sourced chiefly from Chinese suppliers could instrumentality years.

"It volition not beryllium a sprint to physique like-for-like supplier ecosystem arsenic it enjoyed successful China, but a marathon and a measurement by measurement process," Shah added.

India volition relationship for astir 26% of planetary iPhone shipments by the extremity of 2025, up from 20% astatine the commencement of the year, according to the latest estimation by Counterpoint.

Apple's Chief Operating Officer Jeff Williams visited Justech's innovation accumulation halfway successful Jiangsu during his travel to China successful March where helium pledged to proceed to marque large-scale concern successful the country.