From the moment we wake up, devices shape our routines—the smartphone by our bedside, the TV in our living room, the washing machine humming in the background, and the laptop powering our workdays. In a world increasingly reliant on electronics, Dixon Technologies is seizing the chance to solidify its position as a leading player in the industry.
Over the past year, this third-party consumer electronics manufacturer saw its shares reach new highs. Strong financial results, strategic partnerships with global brands, and a rapid expansion of production capacity, supported by India’s Production-Linked Incentive (PLI) scheme, have fuelled this growth.
The company's share price tripled since January 2024, rising from Rs 6,500 in January 2024 to Rs 19,148 in May 2025 as it expanded its presence beyond electronics manufacturing services.
Saurabh Gupta, CFO of Dixon Technologies, said, “India’s push for electronics manufacturing presents a $10 billion opportunity in IT hardware. We expect Dixon to grow in this segment at a rate of 35–40% annually in the next few years.”
However, this optimism comes with a caveat. Dixon’s share price, with a P/E ratio of 122.6, is trading above the industry average of 85.1. Yet, it remains below the company’s historical averages. Dixon’s 5-year average P/E and forward P/E suggest the stock is still undervalued.
In this edition of the Chart of the Week, we analyze the company’s price action from its early joint ventures (JVs) with global brands in 2024 to its recent diversification.
Amid the reversal of US-China tariffs, companies like Apple and Alphabet view the tariff exemption as temporary relief. However, they plan to shift production to India to reduce dependency on a single country and mitigate future political risks.
Indian Electronics Manufacturing Service (EMS) companies like Dixon Technologies, Kaynes Technology, and PG Electroplast are capitalizing on this shift.
Dixon’s new deals power growth in CY24, but policy shift cools momentum
Dixon started CY24 with strong momentum, with its stock rising nearly 11.6% in February 2024, after commissioning a new manufacturing facility in Dehradun to produce washing machines for domestic and global players. The company also entered a contract manufacturing agreement with Compal Smart Device to manufacture mobile phones.
Three months later, Dixon's stock rose 27.5% in June 2024 after it signed a JV agreement with HKC Corporation to manufacture Liquid Crystal Modules (LCM) for smartphones, TVs, and auto displays.
However, Dixon’s momentum faced a temporary setback in July 2024 when the Indian government reduced import duties on mobile phones and chargers from 20% to 15%. While the move aimed to make devices more affordable for consumers, it raised concerns about increased competition from imported phones, potentially dampening the demand for Dixon’s local assembly services.
Despite the import duty change, Dixon's management expressed optimism. Atul Lall, MD of Dixon Technologies, stated, “We are optimistic on the government's positive response to the production-linked incentives scheme in electronics manufacturing. The mobile manufacturing ecosystem in India has matured, and the changes in import duties do not affect India’s competitiveness or strength.”
Following the brief downturn, Dixon’s stock regained momentum in September 2024, driven by its subsidiary Padget Electronics signing a Memorandum of Understanding (MoU) with Asus India to manufacture IT products and laptops.
After a series of agreements and MoUs, investors’ focus shifted to Dixon's Q2FY25 results. The stock gained after its net profit grew 263.2% YoY to Rs 389.9 crore on November 6, 2024, driven by higher mobile phone production and strong growth in the electronics manufacturing services (EMS) segment. Revenue rose 133.3% YoY to Rs 11,534 crore following its acquisition of an EMS provider, Ismartu, in mid-August.
Saurabh Gupta, CFO at Dixon Technologies, stated, “The 56% stake in Ismartu India, with its strong presence in smartphones and feature phones, is expected to add Rs 7,000–8,000 crore to Dixon's revenue by FY27.”Currently, Dixon derives 9% of its total revenue from the US market, primarily through manufacturing Motorola phones.
Dixon's CY24 rally stalls in early CY25
Building on a series of agreements and MoUs, Dixon Technologies' stock rose for six straight sessions in December 2024. The upward trend continued after it signed a JV with Vivo India to establish an original equipment manufacturing (OEM) business for Vivo's smartphones in the Indian market.
Dixon delivered an impressive 173.6% return in CY24, driven by strong growth and expanding partnerships. However, the momentum faltered at the start of CY25. On January 8, the Tata Group announced an $18 billion investment to enter the electronics and semiconductor space, extending far beyond its existing work with Apple, which had started in 2023. This news led to a 12.2% drop in Dixon’s share price as investors reassessed the competitive landscape.
Ekta Mittal, senior analyst at CCS Insight, notes, “Tata Electronics, looking to add clients like Xiaomi and Oppo, will intensify competition in the market, and a price war will follow. Smaller EMS players will find it difficult to match Tata’s scale, supplier deals, and end-to-end delivery capabilities.”
Dixon’s challenges worsened on January 21, 2025, when it missed Q3FY25 net profit estimates by 18.5%, due to higher depreciation and interest costs. The stock plunged 13% as brokerages responded with caution. Jefferies maintained an “underperform” rating, while Goldman Sachs initiated a “sell,” pointing to steep valuations and signs of slowing growth.
Despite a 7.4% decline in its stock price over the first four months of CY25, Dixon’s shares began to recover in late March 2025 after the company partnered with Signify Innovations (Philips Lighting) to expand its product portfolio in lighting products and accessories.
In April, Dixon stock gained momentum on reports suggesting that Alphabet may shift part of its Pixel smartphone production from Vietnam to India due to higher US tariffs on Vietnamese goods than Indian goods. Dixon currently manufactures nearly 70% of Pixel phones in India, and the stock also rose following the government announcement of the Rs 22,919 crore PLI scheme for non-semiconductor electronic components.
Dixon derives 89% of its revenue from mobile phone manufacturing. The company is expanding its product portfolio to include home appliances and consumer electronics to reduce its reliance on this segment.
Dixon plans to invest Rs 1,000 crore in high-margin components such as camera modules, battery packs, and precision parts. In H2FY25, the company secured orders from four global IT brands—HP, Lenovo, Acer, and Asus—for laptops and related IT hardware components. To cater to this demand, Dixon is setting up a dedicated manufacturing unit for IT hardware and telecom products, with production expected to begin in FY26.
Based on this development, Dixon is targeting Rs 3,500 crore in revenue from its IT hardware business by FY26. Atul Lall, MD of Dixon Technology, said, “For the sector and Dixon, the growth path is going to be extremely aggressive in investment and diversification in the future.”
