Dixon aims to boost exports, margin post closure of PLI scheme, says MD Atul Lall

A ramp-up in export volumes and margin expansion through the backward integration route will help Dixon Technologies offset any potential fall in margins and volumes after the production-linked incentive (PLI) scheme ends in FY26, a top company executive said.

Dixon, which has consistently met incremental production targets under the scheme, said incentives contribute around 0.6-0.7% to its mobile phone revenue margins, with majority of the savings passed on to customers. This was indicated during the company's earnings call on Tuesday.

Dixon also does not expect a slide in volumes post-PLI closure due to its deeply entrenched relationships with customers, some of whom have inked strategic joint ventures with the company during the tenure of the scheme.

Dixon shares closed 5.8% lower at ₹15,598 on BSE Wednesday.

Dixon has guided production of 40-44 million smartphones in the current fiscal, which will ramp up to 60-65 million by FY27. Of the estimated 40-44 million smartphone volumes in FY26, it expects export volumes will make up 10-12 million to North America, which will increase significantly in FY27, Atul Lall, chief executive and managing director, Dixon Technologies, said.

The company's customers in smartphone manufacturing include top Android brands in India, including Motorola, Xiaomi, Oppo, Realme, Vivo, Transsion, and Nothing.

While direct incentives will end, Dixon believes the initiatives currently underway will generate benefits that are much more than the PLI contribution, albeit potentially with some time lag.

"We are quite confident of mitigating the impact, and it will be largely driven by integration and also the efforts on efficiency and automation," Lall said.

The company is constructing a new 1 million sq ft facility in Noida for smartphone manufacturing.

"We feel that the initiatives that we are taking on automation, increasing our efficiency, and our foray into components under the ECMS (electronics components manufacturing scheme), the benefits and gains for us are going to be much more. There can be some time lag here and there, but on an overall basis we are sitting on a much healthier and more comfortable position, post PLI," Lall said.



( Originally published on May 21, 2025 )