Current Rating and Its Context
On 03 Nov 2025, MarketsMOJO revised Dixon Technologies’ rating from 'Buy' to 'Hold', reflecting a reassessment of the company’s overall investment appeal. The Mojo Score, a composite measure of various performance and valuation factors, declined by 20 points from 71 to 51. This rating indicates a neutral stance, suggesting that while the stock has solid attributes, it may not currently offer compelling upside relative to its risks and valuation.
Here’s How Dixon Technologies Looks Today
As of 31 January 2026, Dixon Technologies remains a midcap player in the Electronics & Appliances sector, with a market capitalisation reflecting its growing footprint in the industry. The stock has experienced mixed returns over recent periods, with a one-day gain of 1.03% but a one-year decline of 28.47%. This underperformance contrasts with the broader BSE500 index, which has delivered a positive 7.95% return over the same timeframe.
Quality Assessment
The company’s quality grade is rated as excellent, underpinned by robust long-term fundamentals. Dixon Technologies boasts an average Return on Capital Employed (ROCE) of 30.45%, signalling efficient use of capital to generate profits. Net sales have grown at an impressive annual rate of 64.62%, while operating profit has expanded by 54.63% annually, reflecting strong operational execution. Additionally, the company maintains a conservative capital structure, with a low Debt to EBITDA ratio of 0.31 times, indicating a healthy ability to service debt obligations.
Valuation Considerations
Despite its strong fundamentals, the valuation grade is marked as expensive. The stock trades at an Enterprise Value to Capital Employed ratio of 13.3, which is elevated relative to typical benchmarks. However, it is noteworthy that Dixon Technologies is currently priced at a discount compared to its peers’ historical valuations. The Price/Earnings to Growth (PEG) ratio stands at a modest 0.4, suggesting that the stock’s price may not fully reflect its earnings growth potential. Investors should weigh this premium valuation against the company’s growth prospects and sector dynamics.
Financial Trend and Profitability
The financial grade is positive, supported by consistent quarterly performance. The company has reported positive results for 12 consecutive quarters, with net sales for the first nine months reaching ₹38,362.29 crores, growing at 34.29%. The half-year ROCE peaked at 37.74%, while quarterly profit after tax (PAT) surged by 67.8% to ₹287.26 crores. These figures highlight sustained growth momentum and profitability, reinforcing the company’s operational strength despite recent stock price volatility.
Technical Outlook
From a technical perspective, the stock is currently graded as bearish. The share price has declined by 33.26% over the past three months and 37.64% over six months, indicating downward momentum. This technical weakness may reflect broader market sentiment or sector-specific challenges, and it suggests caution for short-term traders. However, the stock’s recent one-day and one-week gains hint at potential stabilisation or consolidation phases.
Institutional Interest and Market Position
Institutional investors hold a significant 47.74% stake in Dixon Technologies, signalling confidence from well-resourced market participants who typically conduct thorough fundamental analysis. This level of institutional ownership can provide stability and support for the stock, especially during periods of market turbulence.
Summary for Investors
The 'Hold' rating reflects a balanced view of Dixon Technologies’ current investment profile. The company demonstrates excellent quality and positive financial trends, supported by strong growth and profitability metrics. However, the expensive valuation and bearish technical signals temper enthusiasm, suggesting that investors should approach the stock with measured expectations. For those already holding the stock, the rating advises monitoring developments closely, while prospective investors may consider waiting for more favourable entry points or clearer technical signals.
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Performance Metrics in Detail
Examining the stock’s recent returns, as of 31 January 2026, Dixon Technologies has delivered a one-day gain of 1.03% and a one-week increase of 0.79%. However, the one-month return is negative at -11.43%, with a three-month decline of -33.26% and a six-month drop of -37.64%. Year-to-date performance also remains subdued at -13.73%, culminating in a one-year return of -28.47%. This contrasts sharply with the broader market’s positive returns, underscoring the stock’s relative underperformance.
Long-Term Growth and Profitability
The company’s long-term growth trajectory remains impressive. Net sales have expanded at an annualised rate of 64.62%, while operating profit has grown by 54.63% annually. The consistent positive quarterly results over the last 12 quarters reinforce the company’s operational resilience. The latest half-year ROCE of 37.74% and quarterly PAT growth of 67.8% to ₹287.26 crores highlight strong profitability and efficient capital utilisation.
Valuation and Market Comparisons
While the valuation is considered expensive, it is important to note that Dixon Technologies trades at a discount relative to its peers’ historical averages. The PEG ratio of 0.4 suggests that the stock’s price growth has not fully caught up with its earnings growth, potentially indicating value for long-term investors. Nevertheless, the elevated Enterprise Value to Capital Employed ratio of 13.3 warrants caution, as it implies a premium price for the company’s capital base.
Technical and Market Sentiment
The bearish technical grade reflects recent price weakness and downward momentum. Investors should be mindful of this trend, especially given the stock’s underperformance relative to the BSE500 index. However, the presence of strong institutional holdings may provide a stabilising influence and potential support during market corrections.
Conclusion
Dixon Technologies (India) Ltd’s current 'Hold' rating by MarketsMOJO encapsulates a nuanced view of the stock’s prospects. The company’s excellent quality and positive financial trends are offset by expensive valuation and bearish technical signals. Investors should consider these factors carefully, balancing the stock’s growth potential against its current market challenges. The rating suggests a cautious approach, favouring existing shareholders monitoring developments and new investors awaiting clearer entry opportunities.
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