Buy Dixon Technologies; target of Rs 18,000: Anand Rathi

What happened

Anand Rathi maintained a BUY rating on Dixon Technologies and set a target price of Rs 18,000. Its report cites stronger-than-expected mobile volumes and expects growth from a Vivo joint venture, customer additions, exports, IT hardware, and telecom and networking businesses.

Confirmed

Global impact / market context

The report’s growth case links higher sales to mobile volumes, new customers and expansion beyond mobiles, while projected cost efficiencies and incentives are expected to raise profit per sale. If achieved, these changes could lift earnings and returns, supporting the broker’s valuation target.

Analyst inference

The report says industry mobile volumes fell 26% year over year in Q2, yet Dixon gained share and beat EBITDA expectations by 12%. It expects smartphone volumes, excluding Vivo, to stay broadly flat in FY27, making other growth sources important.

Confirmed

What to watch

1. Check whether the Vivo joint venture adds the report’s expected roughly 5 million units in FY27 and 22 million in FY28, which would provide a measurable growth contribution. Analyst inference
2. Watch progress in customer additions, exports under MPMS, and IT hardware and telecom businesses; delays or weaker demand could undermine the report’s projected sales growth. Analyst inference
3. Track whether backward integration into displays and camera modules, plus MPMS and IT PLI 2.0 benefits, deliver the forecast margin expansion from FY27 levels. Analyst inference

Evidence

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