Dixon Technologies (India) Ltd. share price target

Strong quarter; Working capital improves; Upgrade back to Accumulate The Q1FY20 results were more than our estimates, and both EBDITA margins and working capital improved, due to strong performance in the consumer electronics segment. Management expects this improvement to continue. As WC improves, debt fell from `1bn to Rs700mn. We expect EPS to grow at a CAGR of 26% over FY19-21E, given strong traction with key customers in its TV and lighting business. The mobile segment should also grow with addition of new customers. Given the better-than-expected Q1...

Dixon has acquired an additional 50% stake in Padget Electronics Pvt. Ltd., the JV for mobile manufacturing in which Dixon already owns 50%. After the transaction, Padget has become a wholly owned subsidiary of the company. Dixon valued Rs270mn as the consideration for the stake, valuing Padget at 2.6x FY19 EBITDA. The net cash payout stood at Rs110mn. The deal should lead to incremental revenues of Rs3.4bn/3.7bn for Dixon's in FY20/FY21E, with EBITDA of Rs84mn/92mn. marquee customer additions will drive revenue sustainability for Dixon. Note that we have now incorporated 100% of Padget Electronics into our estimates....

Refer to important disclosures at the end of this report Recovery in margins, likely to sustain DIXON reported better-than-expected revenues, driven by the Home Appliances,...

Q1, though disappointing on revenues, was in line at an operating and PAT level. While the electronics business faced cost pressures, it was negated by higher margins in lighting, which was almost entirely LED. Management has maintained a 25% revenue growth for FY19. We...

Dixon Technologies came up with the IPO in FY18 and got a great response from investors with a 117x subscription. From its IPO proceed of ` 600mn, company spent `.220mn for loan repayment and `75mn for setting up the plant at Tirupati for LED TVs. There is security premium of ` 596mn raised...

We initiate with a BUY for a price target of Rs. 2,623 (25x FY20 target

Issue Size: 33,93,426 Equity Shares (including *Fresh issue of 3,39,751 Equity Shares + Offer for sale 30,53,675 equity shares) Issue Open: Sept 06 - Sept 08 2017, Price Band: Rs. 1760 - 1766.

ICICI Securities Ltd | Retail Equity Research Incorporated in 1993, Dixon Technologies (India) Ltd (DTL) is engaged in the manufacture of consumer durables, lightings and mobile phones for major brands like Panasonic, Phillips and Gionee. DTL has a fully integrated end-to-end product and solution suite for original equipment manufacturers (OEMs) ranging from global sourcing, manufacturing, quality testing and packaging to logistics. The company is also a leading original design manufacturer (ODM) of lighting products, LED TVs and...

DTIL would continue to report higher revenue and improvement in margins owing to its presence in high growth segments, experienced management and growing share of ODM segment. Despite the company operating on thin margins, it has registered return on capital of a whopping 33.3% in FY2017. Further, it has been generating positive cash flow..

Dixon Technologies (India) Ltd. (Dixon) is the largest home-grown design-focused and solutions company engaged in manufacturing products in the consumer durables, lighting and mobile phones. Of the net proceeds from fresh issue, around 45% will be utilized for the repayment/pre-payment of certain borrowings availed by the company, around 18% will be used to finance backward integration capabilities in the lighting products vertical and around 15% will be deployed for setting up a new manufacturing unit for LED TVs. While...