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Business Standard
23-07-2025
- Business
- Business Standard
Dixon Tech Q1 beats estimates: Check brokerage views, stock strategy here
Brokerages on Dixon Technologies: Dixon Technologies delivered a strong June quarter (Q1FY26) performance, with brokerages highlighting robust outperformance across key metrics, driven primarily by the mobile and EMS segments. The company reported a 95 per cent Y-o-Y growth in revenue and a doubling of net profit, beating most street estimates. While Ebitda margins were slightly down, analysts see strategic levers in place to support medium-term expansion. Domestic brokerage Nuvama Institutional Equities noted that Dixon Technologies once again posted a strong quarter, with revenue, Ebitda, and PAT growth of 95 per cent, 95 per cent, and 68 per cent, respectively, each surpassing their estimates. The strong show was led by a 125 per cent Y-o-Y jump in the mobile segment's revenue and 131 per cent Ebitda growth. The brokerage highlighted that Dixon Technologies retained its mobile volume guidance (42-43 million and 65-67 million units including the Vivo JV) and elaborated on component-related JVs. These include tie-ups for camera modules, enclosures, and precision components aimed at participation in the ECMS scheme. Track Stock Market LIVE Updates While Nuvama acknowledged concerns about potential margin pressure in H1FY27 following the expiry of the PLI scheme in March 2026, it underscored management's confidence in achieving a 130-150 basis points (bps) margin expansion over the medium-term. It maintained a 'Hold' rating with a June 2026 target price of ₹16,100, citing fair valuation. Motilal Oswal also highlighted the strong beat across revenue, Ebitda, and PAT, with the mobile segment again being the standout performer. The integration of Ismartu, improved exports, and higher client volumes drove robust growth. The brokerage stressed upon Dixon Technologies's two-pronged strategy, including strengthening client relationships through JVs and enhancing backward integration via component partnerships. Motilal pointed to the company's strategic alliances – including a display facility with HKC, camera modules with Qtech, and precision components with Chongqing Yuhai – as key steps toward improving Dixon Technologies' margin profile and boosting customer stickiness. Additionally, the JV with Longcheer and Vivo is expected to provide incremental volume growth. Factoring in the strong outlook, Motilal Oswal raised its FY27 estimates by 10 per cent and maintained a 'Buy' rating with a revised target price of ₹22,100 (₹20,500 earlier) based on DCF valuation. Emkay Global echoed a similarly positive tone, noting that Dixon Technologies' revenue growth beat consensus estimates, led by strong performance in the mobile and EMS segments. The brokerage reaffirmed its confidence in Dixon's mobile volume guidance for FY26 and FY27 and highlighted the management's reiteration of 120-150bps margin expansion in the mobile vertical, despite PLI-related headwinds. Emkay sees the company benefiting from scale, strong client relationships, and backward integration. The management's commentary on diversifying into PCBA for industrial and automotive applications was also seen as a positive trigger for Dixon Technologies' next phase of growth. While Emkay slightly cut its DCF-based target price to ₹19,000 (to reflect minority interest from new and upcoming JVs), it maintained a 'Buy' rating, citing sustained competitive advantages and margin expansion drivers. That said, while the impending expiry of mobile PLI benefits poses a risk to margins, brokerages remain optimistic about Dixon Technologies' growth trajectory. Strategic JVs, robust mobile volumes, and a clear focus on backward integration are seen as key enablers of long-term value creation.
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Business Standard
23-07-2025
- Business
- Business Standard
Dixon Tech Q1 beats estimates; analysts upbeat on mobile gains, JV strategy
Brokerages on Dixon Technologies: Dixon Technologies delivered a strong June quarter (Q1FY26) performance, with brokerages highlighting robust outperformance across key metrics, driven primarily by the mobile and EMS segments. The company reported a 95 per cent Y-o-Y growth in revenue and a doubling of net profit, beating most street estimates. While Ebitda margins were slightly down, analysts see strategic levers in place to support medium-term expansion. Domestic brokerage Nuvama Institutional Equities noted that Dixon Technologies once again posted a strong quarter, with revenue, Ebitda, and PAT growth of 95 per cent, 95 per cent, and 68 per cent, respectively, each surpassing their estimates. The strong show was led by a 125 per cent Y-o-Y jump in the mobile segment's revenue and 131 per cent Ebitda growth. The brokerage highlighted that Dixon Technologies retained its mobile volume guidance (42-43 million and 65-67 million units including the Vivo JV) and elaborated on component-related JVs. These include tie-ups for camera modules, enclosures, and precision components aimed at participation in the ECMS scheme. Track Stock Market LIVE Updates While Nuvama acknowledged concerns about potential margin pressure in H1FY27 following the expiry of the PLI scheme in March 2026, it underscored management's confidence in achieving a 130-150 basis points (bps) margin expansion over the medium-term. It maintained a 'Hold' rating with a June 2026 target price of ₹16,100, citing fair valuation. Motilal Oswal also highlighted the strong beat across revenue, Ebitda, and PAT, with the mobile segment again being the standout performer. The integration of Ismartu, improved exports, and higher client volumes drove robust growth. The brokerage stressed upon Dixon Technologies's two-pronged strategy, including strengthening client relationships through JVs and enhancing backward integration via component partnerships. Motilal pointed to the company's strategic alliances – including a display facility with HKC, camera modules with Qtech, and precision components with Chongqing Yuhai – as key steps toward improving Dixon Technologies' margin profile and boosting customer stickiness. Additionally, the JV with Longcheer and Vivo is expected to provide incremental volume growth. Factoring in the strong outlook, Motilal Oswal raised its FY27 estimates by 10 per cent and maintained a 'Buy' rating with a revised target price of ₹22,100 (₹20,500 earlier) based on DCF valuation. Emkay Global echoed a similarly positive tone, noting that Dixon Technologies' revenue growth beat consensus estimates, led by strong performance in the mobile and EMS segments. The brokerage reaffirmed its confidence in Dixon's mobile volume guidance for FY26 and FY27 and highlighted the management's reiteration of 120-150bps margin expansion in the mobile vertical, despite PLI-related headwinds. Emkay sees the company benefiting from scale, strong client relationships, and backward integration. The management's commentary on diversifying into PCBA for industrial and automotive applications was also seen as a positive trigger for Dixon Technologies' next phase of growth. While Emkay slightly cut its DCF-based target price to ₹19,000 (to reflect minority interest from new and upcoming JVs), it maintained a 'Buy' rating, citing sustained competitive advantages and margin expansion drivers. That said, while the impending expiry of mobile PLI benefits poses a risk to margins, brokerages remain optimistic about Dixon Technologies' growth trajectory. Strategic JVs, robust mobile volumes, and a clear focus on backward integration are seen as key enablers of long-term value creation.
Mint
21-05-2025
- Business
- Mint
Dixon Technologies share price drops over 7% despite stellar Q4 earnings; what should investors do now?
Shares of Dixon Technologies came under pressure on Wednesday, May 21, falling over 7 percent in intra-day trade despite the company reporting robust earnings for the March 2025 quarter (Q4FY25). The stock slipped as much as 7.4 percent to hit a day's low of ₹ 15,337.15, extending recent volatility even as brokerages maintained a positive outlook. The sell-off came as a surprise, given the company's impressive operational performance. Consolidated profit after tax (PAT) surged 379 percent year-on-year (YoY) to ₹ 465 crore in Q4FY25, compared to ₹ 97 crore in the corresponding period last year. Revenue also more than doubled to ₹ 10,304 crore, marking a 120 percent YoY jump from ₹ 4,675 crore. Operating performance remained solid, with EBITDA climbing 128 percent to ₹ 454 crore during the quarter. For the full financial year FY25, Dixon Technologies posted a 229 percent YoY increase in PAT, which rose to ₹ 1,233 crore. Revenue from operations also witnessed a steep 119 percent jump to ₹ 38,880 crore, underscoring the company's strong growth momentum across segments. Alongside the earnings, the company's board recommended a final dividend of ₹ 8 per share (400 percent on face value of ₹ 2), subject to shareholder approval. The dividend declaration reflects confidence in the company's cash flow and profitability. Despite the dip in share price, analysts remain upbeat on Dixon Technologies' long-term prospects. CLSA retained its 'High Conviction Outperform' rating and raised the price target to ₹ 19,000, citing strong revenue performance and margin stability. The brokerage expects smartphone volumes to rise to 42–44 million units in FY26 and over 60 million units in FY27, driven by new customer acquisitions, expanded wallet share, and export-led growth. CLSA acknowledged that net profit in Q4 came in lower than estimates due to higher minority interest, but maintained a strong earnings outlook with a projected 45 percent PAT CAGR over FY25–28. The brokerage noted that even as benefits from the PLI scheme taper off, backward integration and scale efficiencies would support margins. Nomura also echoed a positive view, maintaining its 'Buy' rating with a price target of ₹ 21,202. It said Dixon's Q4 performance exceeded expectations, especially in the mobile segment, with exports and domestic orders scaling up. Nomura emphasized the company's diversified client base and strategic partnerships, calling them a strong competitive advantage. Meanwhile, Emkay Global reiterated a 'Buy' call but trimmed its price target by 6 percent to ₹ 19,800. The brokerage revised down FY26 and FY27 EPS estimates due to delays in the Vivo JV rollout and slower-than-expected progress in display module manufacturing. However, it remains optimistic on the company's smartphone volume guidance of 40–45 million in FY26 and 60–65 million in FY27, citing strong export demand from clients like Motorola, IsmartU, and Compal. Despite the sharp fall on Wednesday, Dixon Technologies has been a strong performer over the past year, delivering 85 percent returns. The stock is currently 20 percent below its 52-week high of ₹ 19,149.80, touched in December 2024, but remains up 81 percent from its 52-week low of ₹ 8,440.15, hit in June 2024. So far in May, the stock has declined 6 percent, following a 25 percent surge in April. Prior to that, it posted declines of 5.4 percent in March, 7 percent in February, and 16.5 percent in January, reflecting a volatile start to the year. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
