Dixon Technologies (India) Shares Surge to Record High on Lenovo Manufacturing Contract

Dixon Technologies (India) Shares Surge to Record High on Lenovo Manufacturing Contract

VoM News Desk | December 12, 2023 | 12:34 PM IST | Breaking News | Follow on Google News

Dixon Technologies (India) Shares Surge to Record High on Lenovo Manufacturing Contract

Dixon Technologies (India) Shares Surge to Record High on Lenovo Manufacturing Contract

Dixon Technologies (India) witnessed a remarkable surge in its shares by 6.1%, hitting a new all-time high of ₹6,765 per share during intraday trade on Tuesday, marking its second consecutive bullish trading session.

This significant uptick followed the company’s disclosure on Monday regarding its subsidiary, Padget Electronics Private Limited, securing a manufacturing contract from Lenovo for IT hardware products, specifically laptops and notebooks. This contract falls under the Production Linked Incentive 2.0 Scheme (“PLI”), with the final agreement anticipated upon signing a definitive contract, as stated in the company’s exchange filing.

In a recent move, Padget Electronics had already begun smartphone production for Xiaomi at its newly inaugurated facility in the Noida district of Uttar Pradesh, with an annual capacity of 25 million units.

Dixon Technologies, a leading manufacturer for major consumer durable brands in India and a provider of reverse logistics solutions, has experienced a notable rebound in its shares this year, rallying 68% in CY23. Despite a previous decline of nearly 29% in CY22, the stock has surged from ₹3,927 to ₹6,605 per share and is up by 159% from its one-year low of ₹2,553.

Analysts anticipate substantial long-term benefits for Dixon Technologies, attributing this to its expansions into various verticals, addition of new customers, and scaling up existing operations, including refrigerators, LED monitors, AC components, and other hardware products.

As per brokerage firm Sharekhan, Dixon’s strategic positioning in electronic outsourcing augurs well for its future, especially in the context of India’s vast electronics and consumer durable industry valued at around ₹4,00,000 crore.

Amidst predictions of significant revenue growth, Dixon Technologies posted robust financials for the September quarter, with a 48% year-on-year surge in consolidated net profit to ₹113 crore and a 27.82% increase in consolidated revenues to ₹4,943 crore compared to the same period last year.

At 10:15 AM, the stock was trading at ₹6,605 apiece, showing a gain of 3.63%. The company’s recent developments and promising financial figures continue to fuel investor optimism, driving its shares to new heights.

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VoM News Desk

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