Sharekhan's research report on Dixon Technologies
Consolidated Q2FY23 performance was better than estimates with a slight miss on OPM. Sales growth was led by the mobile and home appliances segments. OPM was restricted to 3.8% due to margin drop in mobile segment. Management expects ~40% y-o-y growth in revenues and OPM to be @ 3.8-4% in FY23. Long-term margin expansion would be led by backward integration and increasing share of ODM revenues. Healthy balance sheet, low working capital and strong revenue/PAT CAGR of ~31%/~47% over FY22-25E justify its rich valuation.
Outlook
We retain a Buy on Dixon Technologies (Dixon) with an unchanged PT of Rs. 4,960 given its leadership in outsourcing consumer electronics/EMS industry, approvals under PLI schemes, a diversified product mix, and robust long-term growth outlook.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!