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Dixon Technologies IPO: Strong fundamentals; Subscribe -
Dixon Technologies IPO: Strong fundamentals; Subscribe
Hem Securities | Published: 06 Sep, 2017  | Source :

Issue Highlights:

Issue Date        : 06th Sept-08th Sept 2017

Price Band       : Rs 1760-1766/Share

Bid Lot             : 8 & in multiplethereof

Face Value      : Rs 10/Share

Listing             : BSE,NSE

Fresh Issue     : Rs 60 Cr

Offer For Sale  : 3,053,675 Eq Shares

Co is the largest home-grown design-focused and solutions company engaged in manufacturing products in the consumer durables, lighting and mobile phones markets in India (Source: Frost & Sullivan Report). Co’s diversified product portfolio in-cludes (i) consumer electronics like LED TVs; (ii) home appli-ances like washing machines; (iii) lighting products like LED bulbs and tubelights, downlighters and CFL bulbs; and (iv) mo-bile phones. Co also provide solutions in reverse logistics i.e. repair and refurbishment services of set top boxes, mobile phones and LED TV panels. Co is a fully integrated end-to-end product and solution suite to original equipment manufactur-ers (“OEMs”) ranging from global sourcing, manufacturing, quality testing and packaging to logistics. Co is also a leading Original Design Manufacturer (“ODM”) of lighting products, LED TVs and semi-automatic washing machines in India (Source: Frost & Sullivan Report). As an ODM, co develop and design products in-house at its R&D centre. Co manufacture and supply these products to well-known companies in India who in turn distribute these products under their own brands. Co have six state-of-the-art manufacturing facilities which are strategically located in the states of Uttar Pradesh and Uttarak-hand meeting the quality requirements of its customers, in-cluding global brands.

Co intends to utilize proceeds from issue in repayment/pre-payment, in full or in part, of certain borrowings availed by company; setting up a unit for manufacturing of LED TVs at the Tirupati Facility; enhancement of co’s backward integration capabilities in the lighting products vertical at its Dehradun I Facility & upgradation of the information technology infra-structure of company.

Investment Rationale

As per the Frost & Sullivan Report, co is the leading manufac-turer of lighting products of CFL, LED bulbs, LED TVs and semi-automatic washing machines in India. Co’s key customers in-clude Panasonic India Private Limited, Philips Lighting India Limited, Haier Appliance (I) Pvt. Ltd., Gionee, Surya Roshni Limited, Reliance Retail Limited, Intex Technologies (I) Ltd., Mitashi Edutainment Pvt. Ltd., Dish Infra Services Private Lim-ited.


Co is bringing the issue at price band of Rs 1760-1766/share on post issue FY17 eps of Rs 44.49 at p/e multiple of approx. 40. Co with its leading market position, strong clientele & experienced promoter base sounds strong fundamentally. However looking after valuation, we recommend "Subscribe" on issue for term long investment.

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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor accept any liability whatsoever arising from the use of any of the above contents.