Buy Dixon Technologies; target of Rs 16700: Motilal Oswal

About this update from Dixon Technologies (india) Ltd.

Motilal Oswal's research report on Dixon TechnologiesDixon’s 3QFY26 revenue/EBITDA came in line with our estimates, though the quarter’s performance was impacted by weak demand in the smartphone industry due to challenges related to higher memory prices and channel inventory. Issues related to higher memory prices are likely to persist for another few quarters, which could weigh on mobile volumes in the upcoming quarters. The company’s efforts on backward integration are progressing in line with schedule and it has also received ECMS approval for camera module and electro transceivers. Approval for Vivo JV has seen delays and the company is hopeful of getting these approvals during this quarter. Considering the current weakness in smartphone volumes and expectations of lower margins in FY27, we cut our estimates by 23%/9% for FY27/FY28 and arrive at a revised TP of INR16,700, based on 2-year forward DCF, implying a target P/E multiple of 55x. Retain BUY as the stock price correction of nearly 46% from the high bakes in these uncertainties.OutlookWe reiterate our BUY rating on the stock with a revised DCF-based TP of INR16,700, implying a target P/E multiple of 55x. Retain BUY as the stock price correction of nearly 46% from the high bakes in these uncertainties.For all recommendations report, click hereDisclaimer: 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.Dixon Technologies_01022026_Motilal Oswal

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