Dixon Technologies: Why Jefferies Foresees 31% Global Smartphone Slump Impacting This EMS Stock Dixon Technologies, an electronics manufacturing services (EMS) company, faces potential challenges as global smartphone demand declines, according to a recent analysis by Jefferies. The brokerage firm maintained a ‘Hold’ rating on the stock, setting a price target of Rs 11,350, which represents a 13% upside from current levels. However, Jefferies highlighted risks tied to slowing smartphone sales, rising component costs, and shifting industry policies that could pressure near-term growth. Jefferies warned that global smartphone shipments could drop 31% year-on-year in 2026, driven by weakening demand and surging memory costs, particularly for DRAM used in smartphones. Higher component prices may reduce affordability in the low- and mid-range segments, potentially dampening order volumes for contract manufacturers like Dixon. The firm noted that Dixon’s mobile and EMS business, which accounts for about 90% of total revenue, is heavily exposed to smartphone market trends. Despite the near-term risks, Jefferies acknowledged Dixon’s long-term growth potential. The company produced around 30 million smartphone units in fiscal year 2025, with expectations of stable volumes in 2026 before rebounding with new client ramp-ups. Over time, Dixon’s share of India’s outsourced smartphone manufacturing market could rise from 30% in FY25 to 50% by FY27, according to the report. However, regulatory and policy shifts are complicating the outlook. The expiration of India’s production-linked incentive (PLI) scheme for mobile manufacturing is a key concern. While budget allocations for the scheme have been reduced for FY27, support for electronic component manufacturing has increased.#electronics_manufacturing #dixon_technologies #jefferies #smartphone_sales #india_pli_scheme
