This multibagger stock doubled shareholders’ money in one year, do you have it?

Multibagger Stock: Shares of Dixon Technologies Limited have doubled investors’ money in the last 12 months. It has increased from the mark of Rs 2305 to Rs 5145.80. The large-cap stock has gained 123 per cent in the past one year and 86 per cent since the beginning of this year.

With a market capitalization of over Rs 29,600 crore, the shares are trading higher than the 100 day and 200 day moving average but lower than the 5 day, 20 day and 50 day moving average.

The company reported a 20 per cent year-on-year growth in its net profit to Rs 62.64 crore for the quarter ended September 2021. The profit in the year-ago period was Rs 52.36 crore. Revenue from operations grew 71 per cent to Rs 2,803.78 crore in the September quarter, from Rs 1,638.74 crore in the year-ago period.

According to brokerage and research firm Anand Rathi, Dixon Tech is targeting the global LED-bulb market. Its new product categories such as refrigerators and telecom equipment are well positioned to support growth in FY23/FY24.

The brokerage firm noted that the joint venture with Bharti Enterprises has been approved under the PLI scheme (Dixon holds 51 per cent). This joint venture can generate revenue of Rs 1400 crore-1600 crore next year. It can generate revenue of Rs 8000 crore-9000 crore in next five years. “We upgrade the stock to ‘Buy’ with a target price of Rs 5,936 based on FY24 earnings,” the brokerage firm said.

According to Marketsmojo, the company has declared positive results for 5 consecutive quarters and is a strong long-term fundamental force. Also, the technical trend has corrected from mildly bullish on September 27, 2021. The stock is technically in a mildly bullish range. However, the stock is trading at a premium to its average historical valuation and has a ‘very expensive’ valuation.

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