Dixon Tech shares rally 5% amid reports of government nod for Vivo JV this month

Shares of technology company Dixon Tech jumped 5% to their day’s high of Rs 12,860 on the BSE on Wednesday after reports claimed that the government is likely to clear the long-pending Dixon-Vivo joint venture this month, which will reduce the risk exposure of the Chinese mobile company to India.

According to a PTI report, an inter-ministerial panel has given in-principle approval to the deal, and MeitY will clear it after due process.

The deal for a joint venture was signed between the two companies in December 2024, in which Dixon Technologies will be the majority shareholder with a 51% stake.The joint venture will focus on manufacturing electronic devices, including smartphones.

Vivo's manufacturing unit in Noida is likely to become part of the proposed JV, which will reduce the company's risk exposure to India.The facility will undertake part of Vivo's original equipment manufacturing (OEM) orders for smartphones in India.

It will also engage in the OEM business of various electronic products for other brands.Also read: Beyond Vedanta: The other Anil Agarwal stock that just exploded 500% on AI boomCurrently, Vivo enjoys a dominant position in the Indian smartphone market.

The Chinese smartphone company is estimated to have sold 3.5 crore handsets in 2025, while Dixon's mobile phone production volume was around 3.2 crore units.

Last week, the company’s subsidiary, Dixon Electroconnect, entered into an agreement with Gemtek Technology to form a joint venture in India for manufacturing and supplying optical transceivers and other telecom products.According to the company, the proposed venture will manufacture and supply Optical Transceiver-SFP (Small Form-Factor Pluggable), BOSA (Bidirectional Optical Subassembly), and other telecom products that the parties mutually agree upon.The proposed transaction will use a mutually agreed structure where Dixon Technologies will hold 60% of Dixon Electroconnect's total paid-up share capital, while Gemtek will hold the remaining 40% stake upon completion.

Read more: AI boom hands HFCL investors nearly 200% returns in just 6 months.

Overheated or undervalued?Dixon Tech Q4 snapshotDixon Technologies reported a consolidated net profit of Rs 256 crore in the March-ended quarter versus Rs 401 crore in the year-ago period, implying a 36% fall.

The profit after tax (PAT) was attributable to the company's owners.

The company's revenue from operations in Q4FY26 was up 2% to Rs 10,511 crore versus Rs 10,293 crore posted in the corresponding quarter of the previous financial year.Meanwhile, the company's total income grew 3% year-on-year to Rs 10,595 crore versus Rs 10,304 crore in Q4FY25.

It included other income of Rs 84 crore compared to Rs 11 crore in the year-ago period.

Dixon Tech shares are down 10% in the last 1 year and about 20% in the last 1 month.

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