Dixon Tech's Display Module JV Aims to Strengthen India's Electronics Sector

Dixon Technologies Shares in Focus After Government Clears Display Module JV with HKC; Nomura Sees Nearly 50% Upside​

Shares of Dixon Technologies Ltd. are likely to remain in focus on Tuesday, March 10, after the company received approval from the Ministry of Electronics and Information Technology to establish a joint venture with Chinese firm HKC Overseas Ltd. for display module manufacturing. Brokerage firm Nomura has maintained a bullish outlook on the stock, projecting significant upside potential.

Dixon to Form JV with HKC Overseas for Display Modules​

Dixon Technologies announced that its wholly owned subsidiary, Dixon Display Technologies Pvt. Ltd., will be converted into a joint venture entity. Under the arrangement, Dixon will hold a 74% stake in the venture, while HKC Overseas will own the remaining 26%.

Following completion of the transaction, Dixon Display Technologies will operate as a joint venture company, combining Dixon’s domestic manufacturing presence with HKC’s global expertise in display technologies. The partnership aims to expand the production of advanced display modules for India’s electronics and automotive industries.

Focus on Advanced Display Technologies​

The joint venture will manufacture, develop, and distribute a range of display components, including thin film transistor LCDs, liquid crystal modules, and other advanced display modules.

These products will cater to multiple applications such as notebooks, mobile phones, televisions, automotive displays, industrial equipment, and monitors.

According to the company, the partnership is designed to strengthen domestic electronics manufacturing capabilities, reduce dependence on imports, and support the growth of India’s local component ecosystem under the Make in India initiative.

Investment Cleared Under Cross Border Regulations​

HKC’s investment required approval from the central government under Press Note 3 of 2020 and the Foreign Exchange Management Rules, 2019, due to regulations governing cross border investments.

The clearance from the Ministry of Electronics and Information Technology enables the companies to proceed with the formation of the joint venture.

Nomura Sees Nearly 50% Upside​

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

The brokerage believes Dixon’s move into display module manufacturing through backward integration could provide structural margin tailwinds for the company.

Construction of Dixon’s display manufacturing plant is already underway. Trial production is expected to begin in the second quarter of FY27, with a ramp up likely in the second half of the same financial year.

Within the components segment, display module assembly offers healthy double digit margins. Nomura expects this business to add around 50 basis points to Dixon’s overall margins by FY28, with potential to reach up to 100 basis points as operations scale up fully.

Stock Performance​

Dixon Technologies shares ended the previous trading session 2.2% lower at ₹9,810 apiece.

The stock has faced pressure in recent months, declining 15.5% over the past month, 45.2% in the last six months, and 18.9% so far this year.