Dixon Tech, BEL, Swiggy, Zomato: Target prices for 4 buzzing stocks

Kotak Institutional Equities has come out with updates on Dixon Technologies Ltd, Bharat Electricals Ltd (BEL), Swiggy Ltd and Zomato Ltd. The brokerage said Dixon Technologies will be a key beneficiary of component PLI, adding that Signify JV will aid its lighting division. Swiggy is pricing in higher in higher risk in quick commerce (QC), it said adding that margin for Zomato's Blinkit will be under pressure in Q4. On BEL, Kotak said the defence PSU's ability to sustain margins at the current peak remains uncertain.

While Dixon Tech, Zomato and Swiggy gained up to 5 per cent today, BEL shares were down 3.3 per cent. 

BEL
Kotak said even as defense ordering saw a sharp uptick in February and March 2025, BEL has reported orders of Rs 18,700 crore in FY2025, 25 per cent below its guidance, driven by a delay in the finalisation of three key orders. Its provisional revenue came in at Rs 23,000 crore. BEL’s order pipeline for FY2026 remains strong, led by large QRSAM (Rs 25,000 crore) and MRSAM (Rs 15,000 crore) orders. But the ability to sustain margins at the current peak remains uncertain, Kotak said it retained 'Sell' on the stock and suggested a fair value (and) FV of Rs 260.

Dixon Tech
Dixon Tech is expected to be the key beneficiary of the Rs230 bn component PLI scheme. Kotak said the company may ramp up its backward integration into display assembly, camera module assembly and mechanical components. Further, it believes that the recently announced deal with Signify will help Dixon improve its lighting segment growth. 

"Lastly, we expect Dixon to report a steady 4QFY25 (132 per cent YoY growth/3 per cent QoQ), driven by continued growth in mobile segments. We upgrade Dixon to ADD from REDUCE as we incorporate the impact of the Signify deal and marginally raise FV to Rs 15,000 (Rs 14,770 earlier)," Kotak said.

Swiggy
Heightened and dynamic competitive intensity in QC will negatively impact the profitability of Instamart in the near term, Kotak said. This business may see weak contributing margin (CM) prints in the near term on account of higher customer acquisition costs as well as a higher pace of store additions, Kotak said as it cut its estimates for Swiggy and now assume a longer path to profitability. 

"The market is already assuming nil value for this business. We also trim estimates for food delivery and now model a FY2025- 28 GMV CAGR of 17 per cent. This results in a revised FV of Rs 400 (Rs 500 earlier)," Kotak said.

Zomato
Kotak expects Zomato to report healthy revenue performance in the march quarter, led by 17 per cent YoY growth in food delivery gross merchandise value (GMV) and 116 per cent YoY growth in Blinkit GMV. It expects food delivery business to report a sequential CM improvement, driven by higher platform fees. "Blinkit’s rapid store addition and higher CAC may weigh on margins and result in a higher adjusted Ebitda loss of Rs 250 crore  (sharply higher than Rs 100 crore in Q3). Key monitorables from the result will be commentary on competitive intensity and Blinkit’s path toward profitability," Kotak said.