Buy Dixon Technologies, target price Rs 11,056: Yes Securities

YES Securities has given buy rating Dixon Technologies with a target price of Rs 11,056. The share price moved down by 0.50 per cent from its previous close of Rs 9398. The stock’s last traded price is Rs 9350.85 .

Dixon Technologies (India) Ltd., incorporated in the year 1993, is a Mid Cap company (having a market cap of Rs 11007.72 Crore) operating in Consumer Durables sector.

Dixon Technologies (India) Ltd. key Products/Revenue Segments include Domestic Appliances which contributed Rs 3631.32 Crore to Sales Value (98.90 % of Total Sales), Job Work which contributed Rs 36.49 Crore to Sales Value (0.99 % of Total Sales), Other Operating Revenue which contributed Rs 2.40 Crore to Sales Value (0.06 % of Total Sales), Rent which contributed Rs .64 Crore to Sales Value (0.01 % of Total Sales), Service Charges which contributed Rs .60 Crore to Sales Value (0.01 % of Total Sales) and Export Incentives which contributed Rs .06 Crore to Sales Value (0.00 % of Total Sales)for the year ending 31-Mar-2020.


Financials
For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 516.94 Crore, down 39.71 % from last quarter Sales of Rs 857.41 Crore and down -54.93 % from last year same quarter Sales of Rs 1146.92 Crore. The Company reported net profit after tax of Rs 1.60 Crore in latest quarter.

Investment Rationale
The brokerage initiates coverage with BUY with a PT of Rs 11,056 based on 32x FY23E earnings (factoring in one PLI license), which would increase to Rs 13,763 in case the company gets both.

Promoter/FII Holdings
Promoters held 36.1 per cent stake in the company as of June 30, 2020, while FIIs and DIIs held 34.2 per cent and public and others 29.7 per cent.