Dixon Technolog. (DIXON)
Fast GrowerFairStock Score: 78/100 — STEADY
Score breakdown: P/E: 0/3 · ROCE: 2/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹14,130 |
| Market Cap | ₹85,913.08 Cr |
| P/E Ratio | 41.49 |
| ROCE | 39.95% |
| ROE | 52.59% |
| Dividend Yield | 0.06% |
| Profit Growth | 999% |
| Debt/Equity | 0.18 |
| Sales Growth | 80.51% |
| Free Cash Flow | ₹57 Cr |
| Promoter Holding | 28.83% |
| 52-Week Range | ₹9,600 — ₹18,471 |
| Sector | Consumer Durables |
| Book Value | ₹897.73 |
Strengths
- Exceptional return ratios: ROE 52.59%, ROCE 39.95%.
- Strong growth: sales up 46.44%, profit up 100.41%, 5-year revenue CAGR 43.22%.
- Sound financial position: debt/equity 0.34, Altman Z-Score 5.75, Piotroski F-Score 8/9.
- Latest quarter revenue of ₹10,672 Cr shows substantial operating scale.
Concerns
- Extreme valuation: P/E 45.44, P/B 21.93, EV/EBITDA 46.05; price is far above Graham Number and DCF value.
- Negative margin of safety: -512.65% against Graham Number.
- Free cash flow of ₹57 Cr is minuscule relative to net profit and market cap, raising earnings quality questions.
- Dividend yield of 0.08% provides negligible shareholder income.
AI Analysis
When I look at Dixon Technologies, I see a wonderful business, but I am being asked to pay a price that makes me uncomfortable. The numbers are impressive: return on equity of 52.59% and ROCE of 39.95% show exceptional capital allocation, while debt-to-equity of just 0.34 keeps the balance sheet simple and safe. The Piotroski score of 8 out of 9 and Altman Z-Score of 5.75 confirm financial health. Growth is staggering too — sales up 46.44%, profit up 100.41%, and a five-year revenue CAGR of 43.22%. The latest quarter’s revenue of ₹10,672 crore and net profit of ₹321 crore show real scale. But here is the problem: at ₹10,857 per share, the market is pricing this as if extraordinary growth will last forever. The P/E of 45.44, P/B of 21.93, and EV/EBITDA of 46.05 leave no room for error. Graham’s number is just ₹1,718.44, and my conservative DCF estimate is only ₹501.34. The margin of safety is deeply negative at minus 512.65%. Even using a PEG of 1.19, that assumes profit growth continues at current levels indefinitely. Meanwhile, free cash flow is just ₹57 crore against a market cap of ₹64,012 crore — earnings quality needs scrutiny. A dividend yield of 0.08% means shareholders rely entirely on price appreciation. This is a fast grower, but I would only buy it if the price corrected significantly. For now, I would rather wait and watch than pay for perfection. Ben Graham taught us to buy with a margin of safety; here, there is none.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer