Dixon Tech shares jump 4% after Q4 results. Do Goldman Sachs, Motilal Oswal forecast further upside?

Revenue from operations for Q4FY26 rose 2% year-on-year to Rs 10,511 crore, compared with Rs 10,293 crore in the corresponding quarter of the previous financial year.

Total income during the quarter increased 3% to Rs 10,595 crore from Rs 10,304 crore a year ago. Other income stood at Rs 84 crore, significantly higher than Rs 11 crore reported in the year-ago quarter.

Earnings before interest, taxes, depreciation and amortisation, or EBITDA, rose 9% year-on-year to Rs 493 crore in the reported quarter.

Dixon Tech shares: Should you buy, sell or hold?

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Brokerage firm Goldman Sachs has maintained a “Sell” rating on Dixon Technologies and revised its target price to Rs 9,790 from Rs 9,985 earlier (3.4% downside). The brokerage said the company’s Q4 results missed estimates mainly due to weaker performance in the mobile and EMS segments, although EBITDA margin at 3.9% remained broadly in line with expectations. Goldman Sachs noted that elevated DRAM prices continue to weigh on mobile phone volumes and expects the FY27 outlook for the mobile business to remain subdued. The brokerage also cautioned that the absence of PLI incentives could pressure margins further and said the earnings downgrade cycle may continue. However, it added that the rollout of PLI 2.0 could emerge as a near-term positive trigger for the stock.
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Motilal Oswal has also maintained a “Buy” rating on Dixon Technologies with a target price of Rs 14,600, indicating an upside potential of 44%. The brokerage said it has slightly revised its FY27 and FY28 estimates to factor in lower volumes and margins, though higher smartphone realisations are expected to provide support. It now expects the company to deliver a CAGR of 33% in revenue, 37% in EBITDA and 36% in profit after tax between FY26 and FY28. The brokerage further said EBITDA margin is projected at 3.3% in FY27 and is likely to improve to 4.1% in FY28 as backward integration initiatives begin contributing following the PLI scheme.JM Financial has maintained an “Add” rating on Dixon Technologies with a target price of Rs 11,200, implying an upside potential of 10.5%. The analysts cautioned that elevated chip prices could weigh on smartphone demand and restrict organic smartphone volume growth in FY27. Excluding Vivo, the company has guided for flat smartphone volumes in FY27, while the best-case scenario would be double-digit growth if the PLI 2.0 scheme materialises and meaningfully boosts exports within the year. The brokerage added that a possible 12-15% rise in smartphone average selling prices could partly offset pressure on revenues, although it believes even flat volumes in FY27 may prove optimistic under current conditions.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)