Dixon Technologies and Vivo Secure Approval for Indian Smartphone Manufacturing Joint Venture

The Indian government has approved a joint venture between Dixon Technologies and Vivo Mobile India to manufacture smartphones and electronic devices. The Department for Promotion of Industry and Internal Trade (DPIIT) granted approval on July 8, clearing a proposal that had been pending under Press Note 3 of 2020. This move allows Vivo to expand its manufacturing operations in India through a majority Indian-owned company.

Key Highlights

• Indian government approves Dixon and Vivo joint venture for smartphone manufacturing.
• Dixon will hold 51 percent and Vivo 49 percent in the new company.
• Initial investment of Rs 5 crore planned with production to start by December quarter.
• Venture could add 20–22 million units and Rs 30,000 crore annual revenue for Dixon.

Joint Venture Details

Dixon Technologies will hold a 51 percent stake in the new company, while Vivo Mobile India will own the remaining 49 percent. The two companies first signed a binding term sheet for this partnership in December 2024. Following government approval, Dixon and Vivo have signed final joint venture and shareholders' agreements, outlining management and operational structures for the new entity.

The joint venture will set up a new company to manufacture smartphones and other electronic devices in India. The primary focus will be on producing Vivo smartphones, but the company can also manufacture devices for other brands. This arrangement allows Dixon to increase its production capacity and expand its contract manufacturing business.

An initial investment of Rs 5 crore will be made by both companies, in line with their respective shareholdings. Once incorporated under the Companies Act, 2013, the joint venture will become a subsidiary of Dixon Technologies. The process is expected to conclude within a year, after which the new company will acquire certain manufacturing assets and take over part of Vivo's smartphone production in India.

Government Policy and Impact

The approval was granted under Press Note 3, a rule introduced in 2020 that requires prior government approval for investments from countries sharing a land border with India, including China. This policy was implemented during the Covid-19 pandemic and remains in effect due to ongoing security concerns.

For Dixon Technologies, the partnership is expected to significantly boost its smartphone manufacturing business. The company has stated that the venture could add 20 to 22 million smartphone units to its annual production over time. It also projects around Rs 30,000 crore in additional annual revenue once the joint venture is fully operational.

Dixon expects production under the joint venture to begin during the December quarter of the current financial year. The company anticipates manufacturing around 11 million smartphones in FY27, with operations expected to scale up further in FY28.