CHENNAI: Noida-based contract electronics manufacturer Dixon technologies India Limited plans to ramp up its capacity on the back of strong order book from the existing customers and new pipeline orders from major global brands.
The company has bagged smartphone contracts from two major brands. These brands are among the ‘largest in the world’ and the production is expected to commence in the next five months. “Agreements with both the customers are in the final stages of closure, and we expect very decent volumes from these two new customers,” said Atul Lall, managing director of the company, in a recent earnings call. He said the company produced 11 million smartphones until the end of December 2023.
It’s currently building a capacity of 30 million smartphones across three of its four plants in Noida. Additionally, the company is building an 860,000 sq.ft. factory in Noida, which would take nearly 2.5 years to complete. . The company is also increasing the volume for manufacturing Xiaomi and Motorola, including for export markets for the latter.
Lall asserted that Dixon would be the largest phone manufacturer in the country and the mobile segment would be the largest contributor to the growth. “Outsourcing opportunities in mobile out of 150-odd million mobile smartphones sold in India is almost 85 million to 90 million. And we feel that in a couple of years, we should at least be at 35%, 40% of that market. So it’s going to be a very large revenue contributor.”
Dixon Technologies posted an operating profit of Rs 104 crore, 215% growth year-on-year with an operating profit margin of 3.2%, and its mobile segment revenue grew 14% in the quarter. The capex of the manufacturer stood around Rs 440 crore in the current fiscal and plans to spend about Rs 400 crore in the next year. It got selected under the production linked incentive (PLI 2.0) on the domestic hybrid category and has committed a capex of Rs 250 crore. It plans to begin the production of notebooks, laptops under new contracts in August, September.