Goldman Sachs has maintained a ‘Sell’ rating on Dixon Technologies with a target price of ₹10,500, implying a 21% downside potential from the current market price of ₹13,300.00. The brokerage acknowledges Dixon’s efforts to increase value addition in its mobile and electronics manufacturing services (EMS) segment, but remains cautious about the impact of the PLI scheme expiry.
Dixon plans to set up new capacities for display modules, camera modules, and precision components over FY26-28, which should enhance its value addition in the EMS segment. While Goldman Sachs has raised estimates slightly to incorporate these developments, it believes that the margin gains from higher value addition will be offset by the loss of the PLI benefits for the mobile segment, which expire in FY26.
Additionally, the brokerage sees limited potential for Dixon to outperform current optimistic estimates, reinforcing its cautious stance on the stock. Given these factors, Goldman Sachs continues to see downside risks and recommends caution for investors at current levels.
Disclaimer: Stock market investments are subject to risks. Investors are advised to conduct their due diligence before making any decisions.
