Dixon Technologies India Ltd

Overview :  A leading electronics manufacturing services company, Is involved in original design manufacturing of Lighting Products, Tv’s, Washing machines, Provides end to end products & solutions to Original equipment manufacturers(OEM’S), Incorporated in the year 1993, Engaged majorly in consumer durables, Lighting & Mobile phone markets, Key customers are Panasonic India, Phillips lighting, Haier, Voltas, Gionee, Reliance retail, Jio, Samsung, Index tech, Dish infra services, Mitashi

Latest Business Updates: 

  • Got order from jio cable set up boxes
  • Added Havells as customer for LED Lighting products in lighting segments
  • Commenced production of home appliances for voltas beko
  • Commenced production of LED TV’s for Samsung from Feb 2020
  • Commenced production of Samsung feature phones from 1st November 2019

 

Product Portfolio:

  • Consumer Electronics
  • Home appliances
  • Lighting solutions
  • Mobile phones
  • Security surveillance systems
  • Reverse Logistics

Revenue Mix :  48% from consumer electronics & 25% from lighting products, Total revenue is around 3,452 crore rupees from last 5 months , 20.8% CAGR Growth in last 3 financial years in revenue which is quiet healthy J

EBITDA(Earnings before interest, depreciation, tax & amortization) Margins are less but growth is 30.3% in last 3 years, PAT(Profit after tax) last years is 31.8%

Now why this is a very interesting stock

Under penetrated consumer durable market of India which is the catalyst

  • Globally Air conditioners at 30% and India at 4%
  • Refrigerator Globally 85% & India 20%
  • Washing machine Globally 70% & India at 10%
  • Flat panel TV Globally 89%, India 60% (YAHA TV ZYADA DEKTE HAI LOGJ)

Rise in Indian domestic consumption has increased 3.5 times in last decade from 31 trillion to 110 trillion, Expected to raise to 335 trillion in 2030 (Aise hi nahi bolte mera bharat mahan, Dum hai desh meinJ)

Earnings & Growth visibility can be clearly seen here for an investor

Key Opportunities:

  1. India a booming consumption economy and a low penetrated market
  2. Brand owners have increased outsourcing their productions
  3. Govt Incentives for Make in India
  4. Rising cost of imports from China

Key Short term risks(Ispe hi zyada focus na karJ)

  • Supply chain disruption
  • Volatility in Input Cost

Share Holding

Promoters hold 36.2% & FII 10.8% FII’S & 22.1% Mutual fund companies

Total Market cap of 5,300 crores, Current PE Ratio at 46.5% ROE & ROCE 18.19 & 27.23% respectively , Debt to equity at 0.29% which is ok, Interest coverage ratio at 4.99, Obviously a capital intensive industry so its quiet fair

 

Signing off

 

 

 

 

 

 

Having worked several years into Life Insurance, Health Insurance, Mutual Funds & Closely with people into financial planning i am now putting my first step in investment advisory

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