Dixon Tech shares rise 4% after Nomura gives it the highest target on the Street

Shares of Dixon Technologies Ltd. are trading with gains of over 4% on Friday, June 27, after brokerage firm Nomura assigned the stock its highest price target on the Street.

Nomura maintained its 'Buy' rating and raised its target price to ₹21,409.

The brokerage said that India's mobile electronics manufacturing services (EMS) industry is likely to be divided among a few key players like Dixon, DBG Technology (China), Bhagwati (unlisted), BYD (Hong Kong), UTL Neolync (unlisted), and Tata Electronics (unlisted), with Dixon expected to hold the largest market share.

Nomura added that Dixon's Original Design Manufacturing (ODM) partnerships, such as with Longcheer, and equity held by customers like Vivo and Transsion, help reduce customer churn risk. It also expects backward integration to strengthen client retention.

Dixon has consistently added new clients faster than peers, helping mitigate risks from weak demand by any single customer.

In the near term (March-May 2025), export sales have surged 4 times, led by Motorola and Transsion, indicating that Dixon's export ramp-up is on track.

Nomura mentioned that Motorola, which sells around 10 million units in the US, mainly sourced from China, could shift production to India due to changing tariffs, benefiting local EMS players.

Motorola's component imports into India have risen sharply in recent months. Dixon accounted for 75% of these imports during April-May 2025, down from 100% earlier, due to capacity constraints.

However, monthly revenues from Motorola have already surpassed previous peaks, and volumes are expected to grow further as new capacity comes online.

Nomura expects Motorola's India volumes to increase from 11 million in FY25 to 16 million in FY26 and 18 million in FY27.

For Dixon overall, the brokerage maintained its estimates of 45 million smartphone units (excluding Vivo) in FY26 and 64 million in FY27.

Nomura added that further upside triggers for the stock could include continued ramp-up in mobile volumes, regulatory approvals for existing partnerships, and announcements of new collaborations.

Philip Capital has slashed its price target on Dixon Tech, citing increased competition in the mobile-phone assembly space. The revised target of ₹9,085 is the second-lowest on the Street for Dixon, trailing only Morgan Stanley's bearish target of ₹8,696.

Of the 33 analysts tracking Dixon Tech, 19 of them have a 'Buy' recommendation, five of them say 'Hold', while nine others have a 'Sell' rating on the stock.

Dixon Tech shares are trading 2.20% higher on Friday at ₹14,636. The stock has declined nearly 20% so far in 2025.

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