Dixon & Amber Shares in Focus After New Mobile Manufacturing Scheme: What Investors Need to Know

The government has notified the new ₹62,500 crore Mobile Phone Manufacturing Scheme (MPMS), replacing the earlier mobile manufacturing PLI that ended in March 2026.

The new scheme will run for five years from FY27 to FY31 and provides incentives for increasing mobile phone production and using more components manufactured in India. For listed electronics manufacturers, Dixon Technologies and Amber Enterprises are two companies that could benefit, although their opportunities are very different.

Dixon already manufactures smartphones at a large scale and could use the scheme to support exports and deeper component manufacturing. Amber, meanwhile, is entering smartphone manufacturing for the first time through its partnership with OPPO.

So, how much can the new scheme actually change their businesses?

What Is the New ₹62,500 Crore Mobile Manufacturing Scheme?

Under the MPMS, eligible mobile manufacturers and Electronics Manufacturing Services companies can receive incentives ranging from 2.25% to 5% on eligible sales.

The scheme also provides an additional incentive of up to 1.5% for domestic sourcing of key components and sub-assemblies, provided localisation conditions are met. The government wants the scheme to increase both manufacturing scale and the amount of value actually created within India.

The key difference from the earlier PLI is that simply having a large manufacturing base may not be enough. Existing brands need to generate substantial incremental sales, while additional incentives encourage companies to source more components domestically.

This makes exports and localisation particularly important for Dixon and Amber.

Why Dixon Technologies Could Be the Bigger Near-Term Beneficiary

Dixon already has a large smartphone manufacturing business and relationships with multiple global and domestic brands.

It is also preparing to add another major customer through its joint venture with Vivo. Dixon received approval for the Vivo JV in July 2026 and expects the business to start contributing to revenue from Q3 FY27.

For Dixon, therefore, MPMS does not create a completely new business. Instead, it can support the next stage of an already large mobile manufacturing operation.

But there is a catch. Under MPMS, Dixon needs incremental eligible sales to maximise incentives. With India's domestic smartphone market currently seeing relatively limited volume growth, exports may become the most important part of Dixon's MPMS opportunity.

Why Exports Could Decide Dixon's MPMS Benefit

Dixon generated around ₹1,100 crore of smartphone export revenue in Q1 FY27.

Management believes two of its anchor customers alone could add around 15 million to 20 million additional smartphone units over the next couple of years, potentially translating into ₹18,000 crore to ₹20,000 crore of additional revenue.

This is important because Dixon cannot depend only on the Indian smartphone market to continuously generate the incremental sales required under MPMS.

Exports provide another growth engine.

Management has itself indicated that based on its calculations, Dixon should become eligible under the scheme once the expected export volumes start coming through.

Brokerages are reaching a similar conclusion. CLSA has highlighted that a significant part of Dixon's business may struggle to meet the new growth thresholds unless exports increase, while Kotak Securities also believes exports will be critical for consistently meeting the scheme's requirements.

For investors, this changes an important metric to track.

Earlier, the focus was mainly on how many smartphones Dixon manufactured. Under MPMS, investors may increasingly need to track how much of Dixon's smartphone production is exported.

Dixon Could Also Make More Money From Each Phone

The second opportunity for Dixon comes from localisation.

Smartphone assembly is generally a relatively low-margin business because many of the expensive components inside the phone are manufactured elsewhere. The EMS company earns primarily for assembling those parts into the finished product.

Dixon is now trying to capture more of this component value itself.

The company has been investing in areas such as camera modules, display modules, smartphone enclosures and batteries. These investments were already part of Dixon's strategy to offset the expiry of the earlier PLI scheme.

This fits well with MPMS, which offers an additional incentive for domestic sourcing of components and sub-assemblies.

If Dixon can manufacture both the phone and a larger proportion of the components inside it, the opportunity changes from simply producing more devices to capturing more value from every device manufactured.

That could ultimately be more important for profitability than the headline manufacturing incentive itself.

Will the 5% Incentive Really Boost Dixon's Margins?

This is where investors need to be careful. An incentive of up to 5% does not mean Dixon's operating margin will increase by 5 percentage points.

Under the previous PLI scheme, Dixon reportedly passed around 3.3% to 3.4% of the 4% incentive it received to its customers. In other words, smartphone brands captured a large part of the benefit.

JM Financial estimates that the old PLI contributed around 0.6 percentage points to Dixon's mobile business margin.

Competition among electronics manufacturers is now also higher than when the original PLI was launched.

Kotak Securities estimates the new MPMS could add around 0.14 to 0.22 percentage points to Dixon's EBITDA margin under its scenario analysis, which is meaningful but much smaller than the headline incentive rate.

Therefore, investors should not simply ask How much incentive will Dixon receive? The better question is: How much of that incentive will Dixon actually retain after sharing benefits with customers?

This makes actual margin improvement an important indicator to watch once MPMS incentives start flowing.

How Can Amber Enterprises Benefit From MPMS?

Amber's smartphone opportunity is at a much earlier stage. The company has traditionally been associated with room air-conditioner manufacturing, but over the past few years it has been expanding aggressively into electronics and printed circuit boards. Its next step is smartphones.

In June 2026, Amber signed a manufacturing collaboration with OPPO India to manufacture smartphones for OPPO, OnePlus and Realme.

Trial production is expected to start in Q4 FY27, followed by commercial production in Q1 FY28.

Amber expects to manufacture around 8 million smartphones in the first year, with volumes potentially increasing to around 15 million to 16 million units in the second year.

For Amber, therefore, the opportunity is potentially more transformational than for Dixon.

Dixon is adding growth to an existing smartphone business. Amber is creating an entirely new one.

Why Amber's Opportunity Is Bigger but Less Certain

Amber's longer-term strategy also goes beyond simply assembling smartphones. The company is building capabilities across electronics and PCBs and has stated that it wants to gradually increase local value addition in its mobile manufacturing partnership.

If Amber can eventually manufacture some of the electronics and components going into the same phones it assembles, it could capture more revenue and potentially better margins from each device.

MPMS's focus on domestic value addition supports that strategy.

However, investors need to separate the opportunity from what has already been achieved.

Amber has not yet started commercial smartphone production. Its first milestone is getting the OPPO manufacturing programme running successfully and reaching the targeted volumes.

MPMS eligibility and the actual financial benefit will then depend on factors such as qualifying sales, brand-wise calculations, localisation and the final economics between Amber and its customers.

That makes Amber's MPMS benefit much less visible today than Dixon's.

Dixon vs Amber: How Their Mobile Manufacturing Opportunities Differ

The distinction is important because both companies may benefit from the same government scheme, but the investment thesis is not the same.

For Dixon, the question is whether MPMS can improve the economics of an already huge business. For Amber, the question is whether it can successfully build the smartphone business in the first place.

What Should Dixon and Amber Investors Track Next?

• Exports: Dixon's export ramp is probably the most important number. Its targeted ₹18,000 crore to ₹20,000 crore export opportunity could help it meet MPMS growth requirements despite slower domestic smartphone volumes.
• Production ramp-up: Dixon's Vivo venture and Amber's OPPO, OnePlus and Realme programme need to move from announced partnerships to actual production and revenue.
• Domestic value addition: Investors should track whether Dixon and Amber are able to manufacture more of the components going into smartphones instead of remaining primarily assemblers.
• Margins: The headline incentive rate matters less than how much benefit eventually reaches profits after sharing incentives with customers.

Author's Take: Dixon Has Visibility, Amber Has Optionality

The ₹62,500 crore MPMS is positive for India's electronics manufacturing ecosystem, but the headline government outlay alone does not determine how much Dixon or Amber will earn.

For Dixon, the opportunity is relatively visible. It already has the customers, manufacturing infrastructure and scale. If exports ramp as management expects and its component businesses grow alongside smartphone production, MPMS can support both incremental volumes and deeper value addition.

The biggest risk is that the scheme requires continued growth. Dixon cannot simply manufacture the same number of phones every year and expect the full benefit. That makes exports crucial.

For Amber, the opportunity could be more transformational because smartphones represent an entirely new growth vertical. Going from almost no smartphone manufacturing today to 8 million units in the first year and potentially 15 million to 16 million units in the second year could meaningfully expand its electronics business.

But Amber still has to prove that it can execute this ramp efficiently.

Therefore, Dixon currently looks like the clearer near-term beneficiary, while Amber offers higher optionality but also higher execution uncertainty.

For investors, the ₹62,500 crore headline is therefore less important than three numbers: Export growth, domestic value addition and the incremental margin actually retained.

Those will ultimately determine whether MPMS becomes a meaningful earnings driver for Dixon and Amber or remains primarily a strong policy tailwind.