Dixon hits a new low

Shares of Dixon Technologies (India) slipped to a fresh 52-week low of Rs 11,480 in intraday trade, extending the recent correction in EMS stocks as investor concerns around near-term volumes, execution timelines and margin visibility intensified. The stock was last trading around Rs 11,720, down marginally on the day, reflecting a meaningful derating in expectations. Trading volumes were elevated, indicating continued institutional churn rather than retail-led selling.

The pressure on Dixon mirrors a broader reset underway in the electronics manufacturing services space, where growth is increasingly contingent on timely regulatory approvals, stable component pricing and sustained brand sourcing commitments. Delays in government approvals for key joint ventures have disrupted the anticipated ramp-up in smartphone manufacturing, pushing out volume recovery timelines into FY27. Compounding this, a sharp surge in global memory prices has raised input costs for entry-level smartphones, forcing several budget-focused brands to slow procurement, directly impacting EMS utilisation levels in the near term.

While Dixon continues to recalibrate its product mix towards higher-margin segments such as wearables, IT hardware and industrial electronics, the market is currently factoring in a phase of operating deleverage and flattish earnings momentum. Importantly, the stock’s fall to a 52-week low reflects concerns around execution timing rather than structural competitiveness.

Dixon retains its leadership position in India’s EMS ecosystem, with a strong balance sheet, deep client relationships and long-term tailwinds from localisation and PLI-led manufacturing. However, until approvals translate into visible capacity ramp-up and demand conditions stabilise, the Street appears unwilling to assign premium multiples, keeping the stock under pressure in the near term.