For the October-December quarter of the current fiscal, Dixon posted a 86% growth in consolidated profit at ₹96.44 crore as compared to ₹51.91 crore a year earlier, aided by strong demand for technology gadgets and expansion of electronics manufacturing in India. Revenue from operations doubled to ₹4,818 crore in Q3 FY24 from ₹2,404.7 crore during the year-ago period, majorly led by a lower base but robust order book.

The growth in top line was backed by robust growth in the mobile & EMS segment, which grew by 251% YoY to ₹3,214 crore. The consumer electronics segment recorded a moderate growth of 8% YoY to ₹929 crore, while the home appliance division rose 18% YoY to ₹288 crore, driven by strong growth in the sales of semiautomatic washing machines. The revenue from security systems segment grew by 65% YoY to ₹200 crore in Q3 FY24.

On the other hand, the revenue of the lighting segment fell by 29% YoY to ₹187 crore, majorly due to the weakened consumer demand and competitive intensity.

According to an analyst at Axis Securities, Dixon Technologies has aggressively increased its capacity in the mobile segment which is substantially increasing the company’s revenue visibility but at the cost of margin erosion. The mobile segment contributes margins of 3.2%.

“The company is gradually expanding its product portfolio in other segments and increasing capacity for future prospects. Currently, the laptop market is predominantly import-driven. The company anticipates a shift towards local manufacturing, which could be a key driver, contributing to the company's growth, supported by the PLI scheme,” said Akshay Mokashe, analyst at Axis Securities, in a post Q3 report released on February 2, 2024.

Earlier this year, Dixon Technologies began production of smartphones for Chinese technology firm, Xiaomi India, at its new Noida factory. In September last year, its subsidiary Padget Electronics signed a deal with Chinese smartphone manufacturer Xiaomi for the manufacturing of smartphones and other related products at the Noida facility. The Noida facility is built across 2.7 lakh square feet and at an annual capacity of 25 million units, the new manufacturing plant represents a significant stride in India's efforts to bolster its footprint in local smartphone manufacturing.

(DISCLAIMER: The views and opinions expressed by investment experts on fortuneindia.com are either their own or of their organisations, but not necessarily that of fortuneindia.com and its editorial team. Readers are advised to consult certified experts before taking investment decisions.)

Padget Compal Smart Device deal

From ₹2,687 to ₹7,045: Dixon Tech shares surge 162% in one year