Dixon posts mixed bag performance in Q3FY22DIXON - 3343 Change: -28.50 (-0.85 %)
News: DTL reported strong revenue growth of 41% YoY in Q3FY22 led by 3x jump in the revenues of Mobile & EMS division. However, EBITDA margin declined 125 bps YoY to 3.4% due to change in product mix and delay in passing of higher raw material prices in the ODM business (lightings & Washing Machine business). PAT declined 25% YoY to Rs.46 crore mainly due to low EBITDA margin and sharp rise in depreciation expenses.
Views: DTL witnessed strong revenue growth of 79% YoY in 9MFY21 even on a challenging period of Covid-19 led disruptions. This was largely due to customer additions in new categories and wallet share gains from existing customers. We maintain our positive stance on the company considering Dixon’s strong order book (to be executed in FY22E-24E under the PLI and launches of new product categories), robust balance sheet condition (RoE. RoCE to be 38%, 40% by FY24%) and efficient working capital management.