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Finance Minister Nirmala Sitharaman, in her Budget speech on Saturday, February 1, increased the Basic Customs Duty on interactive flat panel display to 20% from the earlier rate of 10%.
The basic customs duty on parts for manufacturing open cells of TV panels has been cut to nil from 2.5%.
Gupta said that the duty hike on interactive flat panel display will trigger more domestic manufacturing.”The duty going up from 10 to 20% is a big positive for us, because we have been manufacturing this for last one year. So this will trigger more domestic manufacturing, Gupta said.
The flat panel display industry is worth up to ₹6,000 crore, according to Gupta, and a large part of that was to service to imports. “We also had small revenue coming from this business last year, but definitely this will definitely result in decent revenue starting to come in over the next one year, the Dixon CFO said.”We already have a capacity for this, especially for this interactive flat panel display. We already have a capacity in front and for the display assembly. We are setting up a unit in Noida, which hopefully should be commencing operations by Q2 of next financial year,” according to Gupta.
Additionally, parts of PCBA, camera modules, mic and USB have also been exempt from customs duty from a 2.5% levy earlier. While Gupta said they are examining this in detail, this is still a positive.
“That is a big positive, especially when we have a all the all the brands with us on the Android ecosystem, and we are already exporting for some of the brands. So this is also add to the competitiveness of our industry and for us,” Gupta added.
Finance Minister Nirmala Sitharaman also announced a major tax change under the new regime, where people with income of up to ₹12 lakh will not be liable to pay tax on availing rebates. Gupta said that this will help spur consumption as the demand in recent times was “subdued.”
Dixon Technologies shares fell as much as 9% as an initial reaction to the customs duty announcement. The stock recovered from the lows to end 2.2% lower at ₹14,656.
