Dixon Technologies to Open Factory for Laptop Manufacturing

02 Aug 2024 CW Team

Atul B Lall, Chairman and Managing Director of Dixon Technologies, announced during the company?s recent earnings call, ?We have the top four customers out of the top five local brands operating in the country. For this, a new campus is being planned in Chennai. The site has been identified and the resources have been acquired.?

Lall highlighted the strategic importance of the Chennai facility, stating, ?We target to start this Chennai facility in the next 8-10 months, so this is also going to be a very significant engine of our growth. What the team has been able to do in the mobile front, we aspire to do the same for IT products.?

Currently, Dixon Technologies manufactures notebooks for Acer and has initiated the new product introduction (NPI) process for Lenovo laptops, with mass production expected to commence in the third fiscal quarter of FY2025. ?The Chennai plant should be operational by Q4 of the current fiscal or Q1 of next fiscal. The first phase of acquiring global brands as our customers has already been achieved,? Lall noted, adding that the addressable market for IT products in India is nearly $10 billion.

In the June quarter, Dixon Technologies reported a 101% year-on-year growth in quarterly revenues, reaching Rs 6,588 crore, with net profit surging 109% year-on-year to Rs 1.4 billion. This growth was primarily driven by increased volumes in the mobile and electronics manufacturing services (EMS) divisions, with significant contributions from Motorola and Xiaomi.

Lall detailed the company?s performance, mentioning, ?There is strong growth in volume for Motorola smartphones with a monthly order book of almost 9-10 lakhs per month, including a decent order book for exports. Xiaomi business is also ramped up, now clocking around 7 lakhs per month from July, with higher volumes expected in the festive season.?

Approximately 35% of Motorola phones produced by Dixon are exported to the US and other countries. The company?s partnership with Chinese Original Design Manufacturer (ODM) Longcheer is also producing 4-4.5 lakh units per month, which could increase to 7 lakh units going forward.

Lall revealed that Dixon Technologies would soon add two more global Android handset brands to its customer base. Additionally, the company is set to complete the acquisition of Ismartu, the manufacturing arm of Transsion Holdings, pending approval from the Competition Commission of India. This acquisition would enable Dixon to command 55-60% of the capacity required for smartphones in India.

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Dixon Technologies is nearing the launch of a new factory in Chennai aimed at manufacturing laptops for four of the top five notebook brands in India. The facility is expected to become operational within the next 8-10 months, as confirmed by a senior company executive. Atul B Lall, Chairman and Managing Director of Dixon Technologies, announced during the company?s recent earnings call, ?We have the top four customers out of the top five local brands operating in the country. For this, a new campus is being planned in Chennai. The site has been identified and the resources have been acquired.? Lall highlighted the strategic importance of the Chennai facility, stating, ?We target to start this Chennai facility in the next 8-10 months, so this is also going to be a very significant engine of our growth. What the team has been able to do in the mobile front, we aspire to do the same for IT products.? Currently, Dixon Technologies manufactures notebooks for Acer and has initiated the new product introduction (NPI) process for Lenovo laptops, with mass production expected to commence in the third fiscal quarter of FY2025. ?The Chennai plant should be operational by Q4 of the current fiscal or Q1 of next fiscal. The first phase of acquiring global brands as our customers has already been achieved,? Lall noted, adding that the addressable market for IT products in India is nearly $10 billion. In the June quarter, Dixon Technologies reported a 101% year-on-year growth in quarterly revenues, reaching Rs 6,588 crore, with net profit surging 109% year-on-year to Rs 1.4 billion. This growth was primarily driven by increased volumes in the mobile and electronics manufacturing services (EMS) divisions, with significant contributions from Motorola and Xiaomi. Lall detailed the company?s performance, mentioning, ?There is strong growth in volume for Motorola smartphones with a monthly order book of almost 9-10 lakhs per month, including a decent order book for exports. Xiaomi business is also ramped up, now clocking around 7 lakhs per month from July, with higher volumes expected in the festive season.? Approximately 35% of Motorola phones produced by Dixon are exported to the US and other countries. The company?s partnership with Chinese Original Design Manufacturer (ODM) Longcheer is also producing 4-4.5 lakh units per month, which could increase to 7 lakh units going forward. Lall revealed that Dixon Technologies would soon add two more global Android handset brands to its customer base. Additionally, the company is set to complete the acquisition of Ismartu, the manufacturing arm of Transsion Holdings, pending approval from the Competition Commission of India. This acquisition would enable Dixon to command 55-60% of the capacity required for smartphones in India.

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