Semiconductor stock engaged in providing manufacturing and design-focused solutions for consumer durables, lighting, mobile phones, security devices, and many others upto 4 percent in the day’s trade following inclusion into the MSCI India Index.
Price Action
With a market capitalization of Rs. 71,658 Crores, the shares of Dixon Technologies (India) Limited closed at Rs. 11,960 per equity share, up 2.5 percent from its previous day’s close price of Rs. 11,666.90.
MSCI Inclusion
The shares of Dixon Technologies (India) Limited gained upto 4 percent in the day’s trade following the inclusion of the company in the MSCI India Index which is part of the MSCI Global Standard Index. The global index provider also upgraded the Dixon Technologies stock to mid-cap from the earlier small-cap status.
As per the latest reports of Nuvama Alternative and Quantitative Research, Dixon Technologies (India) Limited can expect possible inflows of $281 Million with the following inclusion in the MSCI Index.
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About the Company
Dixon Technologies (India) Limited is an Electronic Manufacturing Services (EMS) company engaged in providing manufacturing and design-focused solutions for consumer durables, home appliances, lighting, mobile phones, security devices, set-top boxes, wearables, and medical equipment to customers across the globe, along with repairing and refurbishment services of LED TV panels. It has a market share of 50 percent in Security Systems.
Dixon Technologies (India) Limited has various partnerships and subsidiaries with various investments underway to start full-fledged operations for semiconductors. It has a strong customer base with major players like Motorola, Xiaomi, Panasonic, Realme, Samsung, Acer, Lenovo, and many more.
Revenue Breakdown
As of FY24, Dixon Technologies (India) Limited generated 66 percent of its revenue from its Mobile & EMS Division, 23 percent from Consumer Electronics & Appliances, 7 percent from Home Appliances, 4 percent from Lighting Products, and the rest 4 percent from security Systems.
Future Plans
In terms of future plans, For the Mobile and EMS business, It has created a capacity of 45 million smartphones and 40 million feature phones. That’s approximately 50 percent of the opportunity pool in this business, It is making incremental investments in this business in order to meet the increased order book of customers.
It has setup a state-of-the-art R&D center for display devices in Noida for superior product developments in televisions and in IFPDs and signages. It is also actively exploring the manufacturing of industrial, institutional, and automotive displays.
It has signed an agreement with Nokia to manufacture 5G fixed wireless devices, and it sees an extremely good order book in this particular domain. In this particular category, it has also met the thresholds both for PLI investment and revenue.
Financials and Ratios
Its Revenue from operations grew by 101 percent from Rs. 3,272 Crores in Q1FY24 to Rs. 6,580 Crores in Q1FY25, accompanied by profits of Rs. 67 Crores to Rs. 140 Crores.
In terms of Return ratios, it has reported a return on equity (ROE) of 24.7 percent, and a return on capital employed (ROCE) of 28.8 percent. It has reported a debt-to-equity ratio of 0.29.
Written by: Bharath K.S
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