Dixon Technologies Shares Jump 6% After Government Approval for HKC Joint Venture; Brokerages See Strong Upside

Dixon Technologies Stock Rises on JV Approval for Display Module Manufacturing​

Shares of Dixon Technologies Ltd. rose about 6% in early trading on Tuesday, March 10, after the company received approval from the Ministry of Electronics and Information Technology to form a joint venture with Chinese firm HKC Overseas Ltd. for manufacturing display modules.

The development has drawn positive views from brokerages, with Nomura projecting nearly 50% upside for the stock, while JPMorgan continues to maintain an overweight stance.

Dixon Technologies shares were trading 6.1% higher at ₹10,399 in early trade on Tuesday. However, the stock has declined 10.4% over the past month.

Dixon Display Technologies to Become Joint Venture Entity​

Under the arrangement, Dixon Technologies' wholly owned subsidiary Dixon Display Technologies Pvt. Ltd. will be converted into a joint venture entity.

Dixon will hold a 74% stake in the company, while HKC Overseas Ltd. will own the remaining 26% equity.

Once the transaction is completed, the entity will combine Dixon’s domestic manufacturing presence with HKC’s international expertise to expand production of advanced display modules in India.

Focus on Advanced Display Modules Across Multiple Industries​

The joint venture will focus on manufacturing, developing and distributing several advanced display components, including:

• Thin film transistor LCDs
• Liquid crystal modules
• Display modules for notebooks
• Mobile phone displays
• Television panels
• Automotive displays
• Industrial display applications
• Monitor displays

According to the company, the partnership aims to strengthen India’s domestic electronics manufacturing ecosystem, reduce reliance on imports and support local component manufacturing under the Make in India initiative.

Investment Required Government Approval​

HKC’s investment required approval from the central government due to cross border investment regulations.

The approval was necessary under Press Note 3 of 2020 and the Foreign Exchange Management Rules, 2019.

Nomura Sees Nearly 50% Upside for Dixon Technologies​

Nomura has maintained a buy rating on Dixon Technologies with a price target of ₹14,678 per share, implying an upside potential of around 49.6%.

The brokerage believes the company’s backward integration into display modules will create structural margin expansion opportunities.

The display plant construction is progressing, with trials expected to begin in the second quarter of financial year 2027. A production ramp up is anticipated in the second half of FY27.

Nomura estimates that display module assembly carries healthy double digit margins and could add about 50 basis points to Dixon’s overall margins by FY28. With full ramp up, the improvement could reach an additional 100 basis points.

The brokerage also noted that the stock currently trades at about 30 times its estimated earnings per share for FY28.

JPMorgan Maintains Overweight Rating but Cuts Target Price​

JPMorgan has maintained an overweight rating on Dixon Technologies but has reduced its price target to ₹13,000 from the earlier ₹13,700.

The brokerage noted that approval for the HKC joint venture increases the probability of regulatory approval for Dixon’s proposed Vivo joint venture as well.

JPMorgan has incorporated incremental EBITDA contribution from the HKC JV into its estimates. However, it has lowered mobile phone volume assumptions due to ongoing headwinds from rising memory prices.

As a result, the brokerage expects earnings per share cuts of about 13% to 14% for FY27 and FY28.

Despite these adjustments, JPMorgan continues to see strong earnings growth, estimating a 36% compound annual growth rate in earnings between FY26 and FY28, supported by Dixon’s expansion into components through partnerships including Q Tech and HKC.