Dixon Technologies Says Revenue Guidance May Be Lowered
Dixon Technologies' Q1 profit fell 27% sequentially.
Dixon Technologies Ltd., one of India's largest electronics contract makers, said it may lower its FY23 revenue guidance, citing a fall in prices of televisions and a slowdown in demand.
"The Rs 17,000-crore number, which we had guided earlier, might be 10-15% lower," Chief Financial Officer Saurabh Gupta told BQ Prime's Niraj Shah.
He attributed the lower figure to a decline in the average selling prices in televisions. "Year-on-year, the average selling price across the portfolio of TVs has come down from Rs 16,000 to Rs 11,500 and quarter-on-quarter, it has come down from Rs 13,300 to Rs 11,500. So that degrowth in revenue is mainly reflective of pricing growth," Gupta said.
"Overall demand wasn't that good, industry is definitely seeing a slowdown. Things could've been far better. Cautiously hopeful that things should change ahead of the festive season in the next couple of months," Gupta added. "Commodity prices have significantly corrected. That should be a tailwind for us now. Increased sales visibility will also improve our margins."
The company posted a 27% sequential decline in profit at Rs 45.7 crore for the quarter.
Key Highlights (Consolidated, QoQ)
Revenue fell 3% at Rs 2,855.1 crore (Bloomberg estimate: Rs 2,822.2 crore).
EBIT fell 23% at Rs 76.06 crore (Bloomberg estimate: Rs 106.7 crore).
EBIT margin at 2.6% vs 3.3%.
Net profit down 27% at Rs 45.7 crore (Bloomberg estimate: Rs 53.3 crore).
Shares of the company fell as much as 4% before paring some losses to end 3.3% lower on Thursday. Of the 21 analysts tracking the company, 14 suggest 'buy', three recommend 'hold' and four maintain 'sell', according to Bloomberg. The average of price targets suggest a return potential of 16.5%.
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