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Rs 1,011 to Rs 4,198: This stock turned into a multibagger in one year

The share stood at Rs 1,010.71 on June 01, 2020. It has zoomed to Rs 4,198.00 today, translating into gains of 315 per cent during the period

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Share of Dixon Technologies has delivered more than 300 per cent returns to its shareholders in the last 12 months. The share stood at Rs 1,010.71 on June 01, 2020. It has zoomed to Rs 4,198.00 today, translating into gains of 315 per cent during the period. In comparison, Sensex rose 56 per cent in one year.

Rs 5 lakh invested in Dixon Technologies share a year ago would have turned into Rs 20.76 lakh today.

The stock has gained 53.5 per cent since the beginning of this year. It opened 0.72 per cent higher at Rs 4,059.00 against the previous close of Rs 4,029.75 on BSE.

The share stands higher than 5 day, 10 day, 20 day, 50 day, 100 day, and 200-day moving averages. Market cap of the firm rose to Rs 24,194.71 crore on BSE.

For the fiscal year 2021, revenue from operations grew 47 per cent to Rs 6,448.17 crore from Rs 4,400.12 crore in the previous year. Net profit stood at Rs 159.8 crore against Rs 120.50 crore in the previous year.

The company reported a 60 per cent rise in its consolidated net profit to Rs 44.26 crore for the quarter ended March 31, 2021. Profit in the year-ago period stood at Rs 27.58 crore.

Revenue from operations grew 146 per cent to Rs 2,109.71 crore in the March-ended quarter against Rs 857.41 crore a year ago.

Consumer electronics segment contributed 56 per cent of the company's total revenue, followed by lightning products which accounted for 18 per cent and the home appliances and mobile division which contributed 7 per cent and 14 per cent, respectively.

ICICI Direct believes entry into new product categories and customer additions into existing product categories (especially in washing machines, LED lights & mobile phones) would help drive revenue at a CAGR of 63% in FY21-23E.

The company has outlined a CAPEX of Rs 200 crore in FY22 for a brownfield expansion in TVs, washing machines, mobile phones and to start a new manufacturing unit for direct cool refrigerators.

"We tweak our revenue, PAT estimate downward by 6%, 13%, respectively, for FY22E considering the impact of lockdown in Q1FY22. However, a strong balance sheet, increased backward integration and increasing share of Dixon in domestic electronic manufacturing are expected to result in strong PAT CAGR of 87% in FY21-23E," said ICICI Direct.

"We reiterate our 'BUY' recommendation on the stock with a revised target price of Rs 4,635 (earlier Rs 4,270), " the brokerage firm added.

Emkay Global Financial has a 'Buy' rating with a revised target price of Rs 4,500 (45x Sep'23E EPS). It mentioned that LED monitor manufacturing and plans to participate in the RAC PLI adds to current growth levers.

"We incorporate revenues accruing from the PLI schemes and Refrigerator category into our estimates," the brokerage house added.