Nuvama Institutional Equities has trimmed the target price on Dixon Technologies to Rs 16,600 from Rs 16,800. The new target price implies limited room for growth and 1% downside from current levels. The brokerage cut the price target, citing there are uncertainties in the near future.
The company’s Mobile & EMS revenue grew 41% YoY, but Appliances fell 33% YoY due to GST cut-led demand deferment. EBITDA margin stayed healthy at 3.8–3.9%. It indicated a modest cut in mobile volumes to 40–42 million in FY26 and 55– 60 million in FY27, which includes Vivo JV, as against 43–44 million and 60–65 million earlier. The company also did not rule out margin pressure in the Mobile segment in a couple of quarters of FY27.
Nuvama on Dixon Tech: Margin pressure
The brokerage house did not rule out margin pressure in Mobile segment in a couple of quarters of FY27. According to them, the medium to long-term growth plans stay intact and guides towards the Rs 1tn revenue target in next 3–4 years with 4–4.5% EBITDA margin.
Nuvama on Dixon Tech : Scaling up exports
The management remains conservative on published ranges and indicated the possibility of upside via exports and new wins. The company’s management again said that medium to long-term ambitions are of large-scale export, deep backward integration, and componentisation via multiple JVs and ECMS filings.
Dixon Technologies’ medium to long-term growth plans stay intact and guide towards the Rs 1 lakh crore revenue target in the next 3–4 years with an estimated 4–4.5% EBITDA margin.
The company’s revenue grew 29% YoY to Rs 14,800 crore, driven by strong performance in the Mobile & EMS segment. Dixon Tech’s EBITDA rose 32% to Rs 560 crore with margins steady at 3.8%, expanded 10 basis points YoY.
Dixon Tech stock performance
The share price of Dixon Technologies has fallen 4.5% in the last five trading sessions. The stock has declined 11% in the last one month. However, the stock has given a return of almost 2% in the past six months and 4.7% in the last one year.