The semiconductor industry is witnessing a global boom, and India is fast emerging as a serious player. In this context, Tessolve, the semiconductor engineering services company majority-owned by Hero Electronix, is set to receive a massive growth investment from global investment giant TPG. The deal, valued between $140 million and $150 million, could mark one of the largest private equity bets in India’s semiconductor services space to date.
In this article, we will delve into the details of the deal, Tessolve’s growth journey, and why this investment could reshape the future of India’s role in the global semiconductor value chain.
Credits: Ascendants
Deal Structure and Valuation
TPG will invest through TPG Growth, its middle-market and growth equity platform. Industry insiders peg Tessolve’s valuation at $475–500 million, reflecting a more than fivefold jump since its last major fundraising in 2021.
The deal is expected to be structured with both primary and secondary share sales. The primary infusion will help Tessolve expand its footprint and capabilities, while the secondary sales will allow some early investors to partially cash out. Jefferies is advising Tessolve and its shareholders, while Rothschild is representing TPG in the negotiations.
Interestingly, TPG edged out other global private equity players, including Advent International, during the exclusivity stage—underscoring the strong investor appetite for semiconductor services in India.
How Tessolve Plans to Use the Funds
Tessolve is gearing up for a major global push. The fresh infusion will power multiple strategic initiatives, including:
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Expanding delivery centers across international markets to serve its growing client base.
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Enhancing semiconductor test and embedded labs, reinforcing its R&D capabilities.
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Exploring acquisitions to broaden service offerings and deepen its technological expertise.
The objective is clear: position Tessolve as a critical engineering partner in the global semiconductor ecosystem, especially when demand for chips is skyrocketing due to AI, EVs, data centers, and 5G.
From Humble Beginnings to a Global Force
Founded in 2004, Tessolve joined the Hero Electronix fold in 2016, when its revenues stood at just $25 million. Fast forward to FY2025, and the company’s topline has surged past $150 million, reflecting rapid scale-up in less than a decade.
In 2021, Singapore-based Novo Tellus Capital Partners invested $40 million in Tessolve at a valuation of about $100 million. That bet has paid off handsomely, as Novo Tellus now stands to make a partial exit at nearly five times the valuation. Hero Electronix, however, continues to hold a majority stake.
Expanding Workforce and Global Presence
Tessolve today employs over 3,000 engineers spread across operations in India, the U.S., the U.K., Germany, Singapore, and Malaysia. The company operates 11 advanced labs worldwide, offering end-to-end services from chip design and validation to testing and embedded systems development.
Its clients include several of the world’s leading semiconductor companies, many of whom are increasingly outsourcing engineering and testing work to trusted partners like Tessolve to manage costs and shorten time-to-market.
Riding the Semiconductor Wave
The timing of this fundraise is impeccable. The global semiconductor industry, valued at $627.6 billion in 2024, is projected to surpass $1 trillion by 2030. With India rolling out its ₹76,000 crore India Semiconductor Mission, the country aims to reduce dependence on imports and emerge as a global chip hub.
Engineering services firms like Tessolve sit at the heart of this transformation, providing critical design, testing, and integration expertise to both multinational giants and domestic chipmakers.
Why This Investment Matters
For TPG, this is not just another growth equity bet. It’s an entry into a sector that is fast becoming the backbone of the global economy. With chip shortages, supply chain realignments, and geopolitical tensions redefining global tech strategies, semiconductor engineering services have become mission-critical.
TPG brings more than just capital. Its global network, operational expertise, and portfolio synergies could help Tessolve scale faster, innovate more aggressively, and position itself against established global rivals in the engineering services space.
Credits: Bisinfotech
What Lies Ahead
While neither party has released an official statement yet, insiders suggest that a formal announcement is just weeks away. Once signed, this deal will mark a new chapter not only for Tessolve but also for India’s semiconductor industry at large.
If successful, Tessolve could soon emerge as a flagbearer of Indian engineering talent in the global semiconductor race, paving the way for more international investors to back India’s chip ecosystem.
As the world prepares for an era defined by AI, EVs, and digital transformation, Tessolve’s journey underscores one truth: India’s semiconductor story is just beginning, and the best is yet to come.
