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📊 Dixon Technologies Q1 FY26: Strong Growth Amid Strategic Expansions

Lesson 168/173 | Study Time: 10 Min

Course: Quarterly Result Updates & Analysis

📊 Dixon Technologies Q1 FY26: Strong Growth Amid Strategic Expansions

CMP: ₹16,710 | Quarter: Q1 FY26
Sector: Electronics Manufacturing Services (EMS)
Market Cap: Large Cap 🏢

🔍 1. Key Highlights & Strategic Updates

✅ Revenue surged 95% YoY to ₹12,838 Cr
✅ Net Profit doubled YoY to ₹280 Cr
✅ EBITDA rose 89% YoY to ₹484 Cr
✅ Free Cash Flow: ₹57 Cr (vs -₹124 Cr YoY)
✅ ROCE improved to 33.9%, ROE at a robust 49.1%
✅ 📢 JV Approved with Longcheer Intelligence Pte Ltd for manufacturing smartphones, AI PCs, wearables, and healthcare devices via Dixtel Infocom (74% Dixon, 26% Longcheer)

📈 2. Consolidated Financial Performance (₹ Cr)

Metric	Q1 FY26	Q1 FY25	YoY Growth
Revenue	12,838	6,580	+95%
EBITDA	484	256	+89%
EBITDA Margin	3.8%	3.9%	-10 bps
Net Profit	280	140	+100%
PAT Margin	2.2%	2.1%	+10 bps

🧮 3. Segment-wise Performance

🔧 Mobile & EMS (91% of Revenue)

Revenue: ₹11,663 Cr (+125% YoY)
EBIT Margin: 3.4%
ROCE: 82%

📺 Consumer Electronics (5%)

Revenue: ₹672 Cr (-21% YoY)
EBIT Margin: 6%
ROCE: 38%

🧼 Home Appliances (2%)

Revenue: ₹313 Cr (+2.5% YoY)
EBIT Margin: 11.5%
ROCE (excl. FAWM): 51%

💡 Lighting (1%)

Revenue: ₹188 Cr (-17% YoY)
EBIT Margin: 6%
ROCE: 92%

📊 4. Profitability & Key Ratios

Metric	Q1 FY26	Q1 FY25
ROCE	33.9%	32.5%
ROE	49.1%	48.5%
Working Capital Days	-4 Days	-5 Days
Inventory Days	32	32

🔮 6. FY26 Estimates (Based on Trend)

📈 Sales Growth: ~50% YoY
📊 Profit Margin: ~2.2%
💰 Estimated FY26 PAT Growth: ~52%

⚡ Based on past 4 quarters of strong execution, Dixon is likely to maintain growth momentum backed by export demand, government push on electronics manufacturing, and ODM scale-up.

⚡ PE on the Basis of Trail EPS of 192.9 is Trail PE of 87 while Forward EPS for Fy26 should be 214 making the F-PE of 78.

📅 7. Strategic Outlook

🔸 Near-Term (Next 1–2 Quarters):

Stable EMS volumes with continued telecom & IT hardware orders
Margins may remain flat as volumes scale further

🚀 Long-Term (FY26–FY30):

JV with Longcheer to boost ODM capabilities for global smartphone exports
Targeting backward integration to reduce import dependency
Scale-up in wearables, healthcare & AI electronics

✅ 8. Conclusion for Long-Term Investors

👍 Key Positives:

Explosive growth in EMS (core business)
Capital-efficient model with strong ROCE/ROE
Positive cash flows, improving working capital cycle
Policy tailwinds (PLI, electronics exports)

⚠️ Risks to Monitor:

Margin compression in non-core segments (Lighting)
JV execution and ramp-up of new verticals

🎯 Investment Stance: 🟢 Cautiously Optimistic for Long-Term Growth Investors

📢 9. Disclaimer

“This analysis is provided solely for informational purposes and does not constitute investment advice. Investors should perform their own due diligence before making investment decisions.”

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Piyush Patel

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