Motherson Group: Motherson JV to join Apple’s supplier family in India

Motherson Group is all set to enter Apple’s growing supply chain network in India with Hong Kong-based BIEL Crystal Manufactory, one of the world’s largest suppliers of smartphone glass, people with knowledge of the matter said, making the Vivek Chaand Sehgal-led auto parts maker the second major business group after Tata to become an Apple supplier as part of Motherson’s plan to use its core manufacturing capabilities to diversify into other segments.

BIEL was founded in 1989 by billionaire Yeung Kin-man in Shenzhen, China, to make watch glass. The company claims to be one of the first manufacturers of glass screens for mobile devices, starting in the early 2000s when they were mostly made of plastic. By some estimates, BIEL now makes glass screens for two out of three iPhones.

The 51:49% alliance, majority-owned by the Indian company, plans to set up a greenfield manufacturing facility in the south, most likely in Tamil Nadu, at an estimated outlay of Rs 2,000-2,500 crore, the people cited above said. It aims to achieve a turnover of Rs 8,000-8,500 crore in four-five years from the start of operations. The consumer electronics business is expected to start in the July-September quarter.

BIEL’s plants in Guangdong, China, and Bac Ninh, Hai Duong, Vietnam, are on Apple’s approved supplier list in India. It also supplies parts for smartphones, tablets, and wearables, including Samsung, Xiaomi, and Lenovo.

A Motherson spokesperson did not respond to questions, nor did Apple or Biel. Motherson founder and CEO Sehgal told ET he could not comment due to the silence period ahead of quarterly results.

In January, group company Samvardhana Motherson International Ltd (SMIL) announced that its subsidiary Samvardhana Motherson Innovative Solutions Ltd (SMISL) had entered into a series of agreements with BIEL Crystal (Singapore) Pvt Ltd. BIEL was to invest in Motherson Electronic Components Pvt. Ltd (MECPL), a wholly owned subsidiary of SMISL. Although both parties had signed a definitive agreement at the time, details of the joint venture were not disclosed.

The agreement also included BIEL investing in MECPL through 0.01% compulsorily convertible preference shares (CCPS). These were convertible into 10% of equity and potentially 49% on a fully diluted basis. In addition, the glass and crystal giant, along with its subsidiaries, would also provide technical and technological assistance to MECPL. Both parties even agreed on shareholding and management rights. SIML could appoint a majority of directors in MECPL. BIEL could nominate directors based on its shareholding up to 49%. The pact also stipulated that any issuance of equity shares or convertible securities to a third party required the consent of both parties.

Amid heightened geopolitical tensions, Apple has in recent years pushed its suppliers to diversify their manufacturing bases to reduce the risk of over-concentration and over-reliance on mainland China. In addition to India, Southeast Asian countries such as Vietnam, Malaysia, Thailand and the Philippines are set to take advantage of the de-risking initiative.

Driven by growth in Apple iPhone exports from India, electronics overtook gems and jewellery to take the third spot among India’s top 10 exports by the end of the June quarter from fourth place a year earlier. Tata Group alone has invested over $1 billion in greenfield plans as well as acquisitions to boost its stake in Apple.

Gorilla Glass maker Corning, a key Apple supplier, will start production at its Tamil Nadu plant in the second half of 2025, a top executive told ET.

Sehgal wanted to leverage Motherson’s core manufacturing expertise and apply it to new verticals like aviation, healthcare and medical devices, logistics and electronics. As part of his Vision 2025, a quarter of his projected $36 billion in revenue is to come from new businesses. In aviation, the group has already made four acquisitions. In healthcare, apart from two acquisitions, a greenfield unit is being set up in Chennai. Strategic partnerships like the one with BIEL are key to the diversification plan. Motherson currently has 28 partnerships with technology leaders across the world, across automotive and non-automotive segments.

Hong Kong-based Biel tried to list in the Asian financial hub of Hong Kong in 2017, but shelved a planned $1.5 billion public offering a year later due to a stock market sell-off following the Sino-U.S. trade wars. Plans were revived in June 2021, according to a Bloomberg report that said the initial public offering could raise as much as $2 billion.