Shares of technology company Dixon Tech jumped 5% to their day’s high of Rs 12,860 on the BSE on Wednesday after reports claimed that the government is likely to clear the long-pending Dixon-Vivo joint venture this month, which will reduce the risk exposure of the Chinese mobile company to India.

According to a PTI report, an inter-ministerial panel has given in-principle approval to the deal, and MeitY will clear it after due process. The deal for a joint venture was signed between the two companies in December 2024, in which Dixon Technologies will be the majority shareholder with a 51% stake.

The joint venture will focus on manufacturing electronic devices, including smartphones. Vivo’s manufacturing unit in Noida is likely to become part of the proposed JV, which will reduce the company’s risk exposure to India.

The facility will undertake part of Vivo’s original equipment manufacturing (OEM) orders for smartphones in India. It will also engage in the OEM business of various electronic products for other brands.

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Currently, Vivo enjoys a dominant position in the Indian smartphone market. The Chinese smartphone company is estimated to have sold 3.5 crore handsets in 2025, while Dixon’s mobile phone production volume was around 3.2 crore units.
Last week, the company’s subsidiary, Dixon Electroconnect, entered into an agreement with Gemtek Technology to form a joint venture in India for manufacturing and supplying optical transceivers and other telecom products.According to the company, the proposed venture will manufacture and supply Optical Transceiver-SFP (Small Form-Factor Pluggable), BOSA (Bidirectional Optical Subassembly), and other telecom products that the parties mutually agree upon.

The proposed transaction will use a mutually agreed structure where Dixon Technologies will hold 60% of Dixon Electroconnect’s total paid-up share capital, while Gemtek will hold the remaining 40% stake upon completion.

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Dixon Tech Q4 snapshot

Dixon Technologies reported a consolidated net profit of Rs 256 crore in the March-ended quarter versus Rs 401 crore in the year-ago period, implying a 36% fall. The profit after tax (PAT) was attributable to the company’s owners. The company’s revenue from operations in Q4FY26 was up 2% to Rs 10,511 crore versus Rs 10,293 crore posted in the corresponding quarter of the previous financial year.

Meanwhile, the company’s total income grew 3% year-on-year to Rs 10,595 crore versus Rs 10,304 crore in Q4FY25. It included other income of Rs 84 crore compared to Rs 11 crore in the year-ago period.

Dixon Tech shares are down 10% in the last 1 year and about 20% in the last 1 month.

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

Fund performance

■ Columbia Total Return Bond Fund Institutional Class shares returned –0.05% for the quarter ended March 31, 2026.

■ The Bloomberg U.S. Aggregate Bond Index returned –0.05% for the same period.

Market

India’s equity markets appear to be entering a favourable phase, supported by strong corporate earnings, stable macroeconomic conditions, and easing geopolitical concerns. According to Devang Mehta from Spark Capital Private Wealth, the market has already undergone an extended period of correction and consolidation, creating a healthier foundation for future gains.

Earnings Strength Fuels Optimism

Mehta believes the market’s recent resilience has been driven by earnings growth, particularly among mid- and small-cap companies, even as foreign institutional investors remained largely absent.

“The market has gone through the grind of price correction, time correction, and valuation consolidation. The market has always been a slave of earnings, and earnings came out very good across large-caps, mid-caps, and small-caps.”

He added that improving macroeconomic conditions and lower crude oil prices are turning previous headwinds into potential tailwinds.

“There are green shoots showing right now. Looking at macros and earnings, the risk-reward is quite positive, especially for investors with a one- to two-year horizon.”
Power Ancillaries Preferred Over Direct Utilities
While remaining positive on the power sector, Mehta prefers companies that support the broader energy ecosystem rather than power producers themselves.He highlighted opportunities in power automation, transmission infrastructure, and renewable energy-related businesses that stand to benefit from India’s growing electricity demand and infrastructure spending.

“We have been advocates of power and power ancillaries. Companies involved in HVDC, power automation, and renewable infrastructure could benefit significantly from the ongoing capex cycle.”

He also sees value in engineering and manufacturing firms supplying equipment and services to larger power infrastructure players.

“The ancillary theme is the proxy play. The entire capex, power, and infrastructure theme should do very well from here on.”

Positive on HCLTech Deal, Cautious on IT
Mehta welcomed HCLTech’s partnership with Sarvam but maintained his cautious view on the broader IT services sector.

“This tie-up augurs very well. However, we have generally been negative on the IT space for the last three years and continue to hold that stand.”

While acknowledging the possibility of moderate returns from frontline IT stocks, he believes better opportunities exist elsewhere.

“There can be 10-12% CAGR returns from large IT companies, but investors seeking alpha may find better opportunities in financials, capex-related businesses, and consumption plays.”

He noted that IT companies continue to face structural challenges despite sharp corrections in valuations.

“The long term is about how these companies adapt to digitisation and AI. That is something the Street wants to monitor closely.”

Constructive Outlook
With earnings remaining healthy and macro conditions improving, Mehta believes Indian equities are well positioned for the medium term. His preferred themes remain power infrastructure, capital expenditure plays, and financials, sectors that he expects to benefit from India’s ongoing economic and investment cycle.