52-Week High; Dixon Tech's Share Rises 10% On New Smartphone Factory Launch Under PLI Scheme

Dixon Technologies (India) inaugurated its state-of-the-art smartphone manufacturing facility in Noida, Uttar Pradesh. The event marked the culmination of the government's Production-Linked Incentive (PLI) scheme, leading to 5,00,000 jobs in the sector, as highlighted by Union Minister Ashwini Vaishnaw.

The inauguration ceremony saw the unveiling of Dixon's new manufacturing unit, where the company has started the production of smartphones for Xiaomi. The facility, operated by Padget Electronics, a wholly-owned smartphone manufacturing subsidiary of Dixon, spans 2,27,000 square feet and comes with an annual production capacity of 25 million units. With an investment of Rs 256 crore, the facility is poised to play a pivotal role in fulfilling Dixon's manufacturing targets.

At the event, Ashwini Vaishnaw expressed his optimism about the growth of India's design and component manufacturing ecosystem, citing a significant domestic value addition of up to 60% in some products. He emphasized the success of the PLI scheme in propelling job creation and fostering a robust manufacturing environment in the country.

Dixon's association with Xiaomi India dates back five years, and the new manufacturing facility signifies a synergy between the two organizations. Atul Lall, Vice-Chairman and Managing Director of Dixon Technologies, highlighted the excitement surrounding the collaboration, emphasizing the potential of leveraging Dixon's manufacturing excellence with Xiaomi's expertise and leadership in the Indian business ecosystem.

The move aligns with the Indian government's push for increased localisation in mobile phone production and the encouragement for Chinese smartphone makers to export from India. The government's proactive stance has contributed to Xiaomi securing the fourth position in terms of smartphone shipments in India, with an 11.7% market share as of Q3CY23, according to data from the International Data Corporation.

Earlier this month, the company announced a cumulative production value commitment of Rs 48,000 crore over six years, making it eligible under the reworked PLI scheme for information technology products. This commitment positions Dixon to account for a significant portion of the additional production value of Rs 3.5 trillion collectively committed by 27 eligible companies over the next six years.

Dixon Technologies shares hit a fresh 52-week high, trading with gains of nearly 8% at Rs 5,944 per share as of 3 pm. This surge reflects a remarkable return of 52% on a year-to-date basis and a substantial 36% increase over the past year, making Dixon Technologies a standout player in India's electronics manufacturing landscape.