Sharekhan's research report on Dixon Technologies
Consolidated Q1FY23 sales were in-line with estimates, while the bottom-line missed our estimates. Sales were healthy led by strong growth in lighting products, home appliances and mobile segments. OPM was restricted to 3.5% due to inventory and forex loss. Management expects margin to rise and be in the range of 4-4.4% backed by price increases, operating leverage due to higher volumes and backward integration. Revenue growth would be aided by new verticals like washing machines (WMs), refrigerators, customer additions and increase in volumes in mobile and WMs.
We retain a Buy on Dixon Technologies (Dixon) with a revised PT of Rs. 4,500 given promising growth outlook backed by robust demand in its key segments.
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