InnoTek shifts gears to AI, EVs to capture industry changes

FACED with a changing disk drive industry more than 15 years ago, InnoTek – previously Magnecomp, a supplier of high-precision disk drive components – sold its core business to a big customer at a “good price”. It then focused on growing the “very small stamping business” that was left.

Today, the precision components manufacturer is stable but too small to be of interest to most investors, said its chairman Neal Chandaria. “We need to scale our business, and we need to enter sectors and segments which are going fast, which get investors excited.”

Among the promising new sectors it has identified are electric vehicles, and graphics processing unit (GPU) servers that are riding the artificial intelligence (AI) wave.

InnoTek used to have three business divisions – automotive, office automation, and TVs and displays – supported by five facilities in China.

In 2022, in the wake of the pandemic and rising geopolitical tensions, the company created an additional division that focused on new businesses. This division began manufacturing components for GPU servers, gaming machines, medical devices and ATMs.