Dixon Technologies (India) Limited, a leading electronics manufacturing services (EMS) company, is set to significantly boost its smartphone value addition capabilities through a series of strategic moves. The company has announced plans to acquire a majority stake in Q Tech India and form a joint venture with Chongqing Yuhai, potentially increasing its value addition in smartphones from 15-17% to an impressive 45-55%.

Acquisition of Q Tech India

Dixon Technologies has entered into a binding term sheet to acquire a 51% stake in Kunshan Q Tech Microelectronics (India) Private Limited (Q Tech India). This acquisition aims to enhance Dixon's capabilities in manufacturing camera and fingerprint modules for mobile handsets, Internet of Things (IoT) systems, and automotive applications.

Joint Venture with Chongqing Yuhai

In a separate development, Dixon has signed a binding term sheet with Chongqing Yuhai Precision Manufacturing Co. Ltd. to form a joint venture in India. The proposed structure will see Dixon holding a 74% stake and Chongqing Yuhai holding the remaining 26%. This joint venture will focus on manufacturing precision components for laptops, mobile phones, IoT devices, and automotive applications.

Implications for Dixon's Value Chain

These strategic moves, coupled with Dixon's existing joint venture with HKC for display modules, are expected to significantly increase the company's value addition in smartphone manufacturing. Analysts project that Dixon's contribution could rise from the current 15-17% to an impressive 45-55%.

Financial Outlook

The expansion into critical component manufacturing is anticipated to have a positive impact on Dixon's financial performance. Industry analysts project potential margin improvements of 150-200 basis points, along with the opening of new revenue streams for the company.

Management's Perspective

Atul B. Lall, Vice Chairman & Managing Director of Dixon Technologies, expressed enthusiasm about these developments. Regarding the Q Tech India acquisition, he stated, "This collaboration is a testament to our commitment to technological excellence, self-reliance, deepening of component ecosystem and delivering greater value to our global and domestic partners."

On the joint venture with Chongqing Yuhai, Lall commented, "This Joint venture with Chongqing will focus on manufacturing precision mechanical & metal parts & components for a wide range of applications including laptops, mobiles, IOT, automotive which is a significant step in our effort towards localisation of key components, deepening backward integration in Dixon value chain & supporting the Make in India initiative of the Government."

Looking Ahead

These strategic moves position Dixon Technologies to play a more significant role in India's electronics manufacturing ecosystem. By expanding its capabilities in critical components like camera modules, fingerprint sensors, and precision parts, Dixon is aligning itself with the country's push for greater self-reliance in electronics manufacturing.

As the company prepares to announce its Q1 FY2026 results on July 22, 2025, investors and industry observers will be keenly watching how these new ventures translate into financial performance and market position for Dixon Technologies.

Dixon Technologies (India) Limited, a leading electronics manufacturing services (EMS) company, has announced two significant strategic partnerships to enhance its manufacturing capabilities and expand its product portfolio.

Partnership with Chongqing Yuhai Precision Manufacturing

Dixon Technologies has entered into a binding term sheet with Chongqing Yuhai Precision Manufacturing Co. Ltd. to form a joint venture in India. The proposed joint venture will focus on manufacturing and supplying precision components for laptops, mobile phones, IoT devices, automotive applications, and other mutually agreed products.

Key details of the joint venture:

• Dixon will hold 74.00% of the total paid-up share capital
• Chongqing Yuhai will hold the remaining 26.00%
• The partnership is subject to necessary statutory approvals and signing of definitive agreements

Mr. Atul B. Lall, Vice Chairman & Managing Director of Dixon Technologies, commented on the collaboration: "This joint venture with Chongqing will focus on manufacturing precision mechanical & metal parts & components for a wide range of applications. It is a significant step in our effort towards localization of key components, deepening backward integration in Dixon's value chain & supporting the Make in India initiative of the Government."

Acquisition of Majority Stake in Q Tech India

In a separate development, Dixon has also signed a binding term sheet with Kunshan Q Tech Microelectronics (India) Private Limited (Q Tech India) and its shareholders for the proposed acquisition of a 51.00% stake in Q Tech India. This strategic move aims to strengthen Dixon's capabilities in camera and fingerprint modules for mobile handsets, IoT systems, and automotive applications.

The acquisition details include:

• Dixon to acquire 51.00% shareholding in Q Tech India
• The deal involves a combination of primary and secondary investment
• Subject to signing definitive agreements and regulatory approvals

Mr. Lall stated, "Acquiring majority stake in Qtech India is a major step forward in Dixon's journey foraying into development and production of camera modules and fingerprint recognition modules across mobile handsets, IoT devices and automotive applications, thereby strengthening backward integration plans of the Company."

Impact on Dixon's Growth Strategy

These strategic partnerships align with Dixon's long-term vision to become a leading enabler in India's electronics manufacturing ecosystem. By combining the technological expertise of its new partners with Dixon's robust manufacturing infrastructure and customer access, the company aims to:

1. Enhance capabilities in critical component manufacturing
2. Deepen backward integration in its value chain
3. Support the Make in India initiative
4. Accelerate technology transfer and innovation
5. Strengthen India's electronics component ecosystem

As Dixon Technologies continues to expand its manufacturing capabilities and product portfolio, these partnerships are expected to create long-term value for customers and stakeholders while positioning the company for future growth in the rapidly evolving electronics manufacturing sector.