1:5 Splits, 7 Dividends: Consumer Electronic Stock Fell By Rs 2,530 In 1-Day; Should You Buy-On-Dips?

JM Financial report said, Q3 was a quarter of strong operating performance (revenue: 8%, EBITDA: 16% ahead of estimates). However, higher-than-estimated depreciation and finance cost led to a 7% miss on PAT. Mobiles continued to be the largest contributor to growth, driven predominantly by Ismartu. Dixon's next leg of growth is expected to result from its strong focus on backward integration, which it initially expects to drive from its foray into display, camera and battery module assembly and, thereon, by setting up a display fab.

These initiatives are likely to drive value addition and give it incremental control over the supply chain, remoulding Dixon into a heavily backward integrated electronics manufacturer. Execution, however, will remain extremely crucial. While we factor in marginal changes in our EPS estimates, we acknowledge potential upside risks to our forecasts, while the key downside risk remains a delay in execution. We maintain BUY with a target price of INR 19,000 at 66x Mar27E EPS.