DIXON TECHNOLOGIES (+) : In-line quarter on muted expectations; mixed guidance

Research evidence excerpt

DIXON TECHNOLOGIES (+) : In-line quarter on muted expectations; mixed guidance

Refinitiv

4QFY26 earnings call summary

Mobile phones & EMS:

- The smartphone business faced headwinds from memory price inflation and

demand moderation over the past 6M. Dixon has observed an improvement in the

past few weeks, with higher double-digit q-q volume growth expected in 1QFY27

along with c12-15% growth in ASPs.

- Dixon expects the new 400k sq. ft facility for Longcheer JV to be operational by

3QFY27 and is in discussion for product expansion.

- The mass production at the Noida’s mobile-phone manufacturing facility for an

anchor customer is expected to begin in 2QFY27.

- It clocked c33m smartphone sales in FY26 (c5.6m in 4Q) and expects a similar range

for FY27 excl. Vivo. Post the Vivo approval, it expects to clock additional c20-22m

volumes on an annual basis.

- Furthermore, it plans to start the exports of feature phones to Africa under ‘Ismartu’

from 2QFY27, taking the total FY27 mobile phone volume guidance to c50m (total

exports in FY26 was c4-4.5m). It anticipates PLI 2 to aid in an incremental c4-5m

p.a exports volume, assuming the scheme’s focus on exports.

- The management has guided to expand the camera module production capacity

from c70-80m p.a to c180-190m p.a over the next 15-18 months (expects cINR25b

revenue for FY27 from this expansion).

- Dixon received PN3 and ECMS approval for display module production under HKC

JV. The construction of display module facility is nearing completion with a capacity

of c24m smartphones and c2m notebooks p.a. in the first phase with trial production

to commence by 3QFY27 and mass production by 4QFY27 (plans to ramp up

capacity to c50m p.a). Post attaining c80-90% capacity utilisation, the segment is

expected to have cINR55-60b p.a.