Dixon Partners with HKC for Display Module Manufacturing Amid Push to Relax Press Note 3 Restrictions

Dixon Technologies has partnered with the Chinese firm HKC Overseas for manufacturing display modules. In a statement on August 17, the Indian electronics contract manufacturer said the two companies have formed a joint venture for ₹370 crore to produce and sell LCD and TFT-LCD modules, used in electronics devices like TV, mobile phones, etc., for display. 

As a part of the deal, HKC Overseas will acquire a 26% stake in Dixon Display Technologies (DDTPL) for $10.998mn and Dixon will acquire a 74% stake in JV for $31.3mn in two tranches. 

“Dixon Technologies [India] Ltd has entered into a Term Sheet with HKC Corporation Ltd to form a joint venture for manufacturing of Liquid Crystal Modules, thin film transistor liquid crystal display modules, assembly of end products such as smartphones, TVs, monitors and auto displays and selling HKC branded end products in India,” said Dixon Technologies.

This comes just a month after Dixon formed another JV with the Chinese electronic components company Chongqing Yuhai Precision Manufacturing Co Ltd and the Indian unit of Kunshan Q Technology. Dixon, in partnership with these companies, aims to manufacture, distribute, and sell camera and fingerprint modules for mobile handsets, internet of things (IoT) systems, and automotive applications. 

These developments have come around a time when Indian companies’ partnerships with Chinese firms have come under government scrutiny under Press Note 3 of 2020. The homegrown firms have urged the Narendra Modi-led government to ease restrictions on investments from countries sharing a land border with India, including China. While Indian firms are ramping up efforts to push for more local manufacturing, their significant dependence on foreign countries, including China for technology and talent has prompted their demand to ease restrictions. But so far, the government has shown no signs of easing the restrictions on investment.