Dixon rises 4% on camera module foray; brokerages decode stock strategy

Don't want to miss the best from Business Standard?

Dixon Technologies in focus: Home grown manufacturing company Dixon Technologies share price was buzzing in trade on Wednesday, July 16, 2025, with the scrip rising as much as 3.85 per cent to hit an intraday high of ₹16,428 per share. 

 

At 9:20 AM, Dixon Technologies share price was trading 3.08 per cent higher at ₹16,305.05 per share. By comparison, BSE Sensex was trading 0.06 per cent lower at 82,522.16 levels.

  The shares were buzzing after Dixon Technologies, on July 15, 2025, announced that it has signed a binding term sheet to acquire a 51 per cent stake in Q Tech India. The move marks Dixon’s entry into the camera and fingerprint module segment, with applications across mobile handsets, IoT devices, and the automotive sector. 

 

The acquisition, involving both primary and secondary investments, is subject to definitive agreements and regulatory approvals. According to the company, the deal is a step forward in boosting its backward integration strategy and strengthening India’s electronics components ecosystem.  CATCH STOCK MARKET LATEST UPDATES LIVE 

In a parallel development, Dixon also announced a 74 per cent joint venture with Chongqing Yuhai Precision Manufacturing. The JV will focus on manufacturing precision mechanical and metal components for laptops, mobile phones, IoT products, and automotive applications — marking Dixon’s foray into the precision components segment.

 

Brokerages decode why this move is a strategic win for Dixon Technologies:

Nomura

 

Nomura believes Dixon Technologies’ latest move to acquire a 51 per cent stake in Q-Tech’s India unit is strategically sound and earnings accretive. The brokerage highlighted that Q-Tech is a key global player in the camera module space, with a focus on >32MP cameras, OIS/periscope modules, and growing presence in segments like drones, automotive, VR and robotics. It counts major handset brands like Vivo, Oppo and Xiaomi among its key customers.

 

Q-Tech India has already scaled up well, clocking about ₹2,400 crore in FY24 revenue with an Ebitda margin of 5.8 percent. Based on an average realisation of about ₹400 per camera module, this suggests volumes of approximately 50 million units-implying a nearly 10 per cent market share. Nomura expects Dixon’s backing could help Q-Tech India scale to 50–60 million phones over the next few years.

 

With operating leverage and support from the components PLI scheme, margins are also expected to improve. Importantly, acquiring an existing Indian entity will fast-track integration and avoid regulatory delays.

 

Nomura estimates that this initiative alone could boost Dixon’s earnings per share (EPS) by over 5 per cent by FY28F, depending on the pace of scale-up. Additionally, the precision components JV targets another 8-10 per cent of the smartphone bill of materials (BoM). 

 

Together with its display module JV with HKC, Dixon could potentially address about 30 per cent of the smartphone/laptop BoM-up sharply from 8-10 per cent currently. This, Nomura analysts said, will considerably boost Dixon’s customer stickiness and deepen its competitive moat. The brokerage maintains its ‘Buy’ rating on the stock with an unchanged target price of ₹21,409.  ALSO READ | What to do with ICICI Lombard shares after Q1 results? Stock rises 2%

JM Financial 

 

JM Financial, meanwhile, believes these backward integration initiatives are well aligned with Dixon’s display sub-assembly tie-up with HKC and will help the company boost capabilities at a time when the mobile PLI scheme is winding down and competition is intensifying. It noted that such partnerships will strengthen customer relationships while also being margin accretive.

 

With India being a 150 million-unit smartphone market and Dixon Technologies targeting 60–65 million units by FY27, JM Financial sees major internal opportunities for new product deployment. 

 

“We factor this in through a 1-3 per cent increase in our FY25-27E EPS estimates. Maintain ‘Hold’ with a revised target price of ₹16,000, set at 60x Mar’27E EPS,” JM Financial analysts said.