Dixon Forms JV With Inventec To Make PC Products In India

SUMMARY

Via the joint venture (JV) the company plans to make notebook and desktop PC products, including components and servers in India

As per the JV agreement, the company will set up a wholly-owned subsidiary named Dixon IT Devices Private Limited

The development comes days after reports surfaced that Dixon is looking to foray into the electronics component manufacturing space

Homegrown electronics manufacturer Dixon Technologies has entered into a joint venture (JV) with Taiwan-based manufacturing company Inventec Corporation to make notebook and desktop PC products, including components and servers in India.

“The arrangement is in line with the strategy of the company to grow in this business segment and to achieve strategic goals and expansion of business,” Dixon said in an exchange filing.

As per the JV agreement, the company will set up a wholly-owned subsidiary named Dixon IT Devices Private Limited, where Dixon will own 60% of the total issued and paid up share capital and the remaining 40% will be owned by Inventec on a fully diluted basis.

On grounds of financial terms of the deal, the filing mentioned that no consideration has been exchanged between the parties.

Shares of Dixon closed about 1% lower at INR 16,481.70 apiece on the BSE yesterday.

Notably, the company has emerged as a big local player in the electronics manufacturing space on account of consistently achieving its PLI targets and receiving incentives and subsidies from the government, especially for manufacturing smartphones. It already manufactures smartphones for Samsung, Motorola, Xiaomi, and Jio.

The development comes two days after a report surfaced that Dixon is looking to foray into the electronics component manufacturing space (ECMS), where it has started working on a project for display modules and is now looking at manufacturing components like camera modules, mechanical enclosures and lithium ion batteries.

The electronics manufacturer previously signed a memorandum of understanding (MoU) with the Tamil Nadu government to set up a manufacturing facility near Chennai for making laptops and PCs, with a total investment of INR 1,000 Cr, about a month ago.

A few months ago, Dixon also set up another subsidiary Dixon Teletech, to manufacture IT hardware components, products, and equipment.

On the financial front, Dixon Technologies India’s consolidated profit after tax (PAT) zoomed 47% to INR 375 Cr in FY24 from INR 255 Cr in the previous fiscal year. Meanwhile, its revenue from operations surged 45% to INR 17,691 Cr during the year under review from INR 12,192 Cr in FY23.