Will Dixon Technologies stock be affected by the ₹6,000 Cr SFIO case against Vivo?

Synopsis: The ongoing charges on Vivo have affected Dixon Technologies shares today; let us see what the case is about as well as how Dixon Tech will be affected by it.

The shares of this company, which is an Electronic Manufacturing Services (EMS) company with operations in the electronic products vertical, such as consumer electronics, lighting, home appliances, closed-circuit television cameras (CCTVs), and mobile phones, had its shares hit due to the charges alleged on Vivo, a joint venture of Dixon Tech.

With a market cap of Rs 85,015 crore, the shares of Dixon Technologies (India) Ltd tumbled more than 3.58% in today’s intraday session and closed at a price of Rs 14,020. The shares are trading at a PE of 65.8, whereas the industry PE is 26.4, and have given a return of almost 517% over the last 5 years. 

About the Charges against Vivo.

The latest development has put the spotlight back on Chinese smartphone makers in India. According to the report, the Serious Fraud Investigation Office (SFIO), which is acting on directions from the Ministry of Corporate Affairs, is now preparing to file a formal chargesheet against Vivo.

The case centers around alleged fund diversion of over Rs 2,000 crore and is part of a wider probe that also covers Oppo and Xiaomi, with the total suspected amount across all three brands nearing Rs 6,000 crore, which took place in the month of August this year. 

Government officials, according to the report, stated that SFIO’s investigation into Vivo is largely complete, and the authority is now ready to proceed under Section 447 of the Companies Act, which deals with corporate fraud and carries both civil and criminal liabilities.

These allegations trace back to findings by the Registrar of Companies (RoC), which flagged concerns around related-party transactions and suspicious financial flows within Vivo India.

Vivo, on the other hand, is reportedly gearing up to challenge the charges, maintaining that the questioned transactions were legitimate business movements. Despite the pressure, Vivo continues to be one of India’s largest smartphone players by volume, which makes the case significant not just legally but also for the broader electronics manufacturing ecosystem in the country.

How is Dixon Tech involved? 

This is where Dixon Technologies enters the picture. Last year, Dixon signed a joint-venture agreement with Vivo, where Dixon holds 51% and Vivo 49%, with the aim of manufacturing smartphones and other electronic devices in India.

Because of this direct operational link, every new development in the SFIO probe naturally raises questions about whether there could be any knock-on impact on Dixon, even though no allegation has been made against Dixon itself. The association alone has been enough to create caution among investors, making the shares fall more than 3% today. 

For now, it’s still unclear whether Dixon will face any direct effect, but the situation will need to be closely tracked. If the chargesheet leads to operational or regulatory hurdles for Vivo, it could slow down or complicate the execution of their JV plans with Dixon. At this point, Dixon’s risk is more indirect and reputational, but the market is watching how this unfolds and how the legal developments around Vivo might reshape the broader electronics manufacturing landscape.

Financials and more. 

The revenue from operations stands at Rs 11,534 crore in Q2 FY25 and Rs 14,855 crore in Q2 FY26, showcasing a YoY growth of about 29%. Along with the sales, the profits also grew from Rs 412 crore in Q2 FY25 to Rs 746 crore in Q2 FY26, which is a growth rate of about 81%. 

Out of the total revenue of Rs 13,361, which is around 90% of the total, comes from the mobile and EMS section; this is the reason why markets took the charges on Dixon Tech negatively, as the majority of its revenue comes from mobiles and similar components. Therefore, what happens with Vivo might affect Dixon’s revenue and share performance as well in the future 

Dixon Technologies has grown into one of India’s most trusted electronics manufacturers, often called the “brand behind brands” because so many global companies rely on it to build their products. From LED TVs and washing machines to lighting solutions, the company designs and manufactures a wide range of consumer electronics.

Its biggest strength, however, is its Mobile & EMS division, which produces mobile phones, hearables, wearables and laptops for major global brands and now contributes 90% of Dixon’s total revenue. With its focus on quality, innovation and strong customer relationships, Dixon has become a key player in India’s push to become a global electronics-manufacturing hub.

Written by Leon Mendonca. 

Disclaimer

The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.

The post Will Dixon Technologies stock be affected by the ₹6,000 Cr SFIO case against Vivo? appeared first on Trade Brains.