Dixon Technologies On Track.

Sunil Vachani's Dixon Technologies Proving India Wrong.

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Sunil Vachani, CEO, Dixon Industry.

Almost three decades ago, Sunil Vachani borrowed $ 35,000 so he could start making 14-inch television sets in a rented shed outside New Delhi. Today, Vachani’s startup has grown into a sprawling electronics empire. His Dixon Technologies boasts a market value of more than $ 2.5 billion and the capacity to produce about 50 million smartphones this year.

While Vachani, 52, struggled in his early days, his company’s shares have surged 824% since a 2017 initial public offering. “This is only a start,” Vachani said in a telephone interview. “We are bringing about a mindset change that global manufacturing can happen in India.” The founder and his siblings are now in the league of India’s billionaire families.

Vachani, who controls a one-third stake worth about $ 900 million, just bought one of the more extravagant homes in the country – a $ 20 million mansion in New Delhi’s tony Lutyens neighborhood.India has been plagued for decades with rickety infrastructure, heavy taxes and crushing bureaucracy.

Vachani comes from an entrepreneurial family. His father and siblings started a business that produced electronics and appliances under the Weston brand. They made the country’s first color televisions and video recorders – and operated a string of video game parlors on the side. The Vachanis are Sindhis, a small community in India with a reputation for business acumen.

After studying business in London, Sunil opted to go his own way in 1993 rather than join the family business, a decision that quickly led to difficulty. He ran out of working capital and found banks wouldn’t lend to him without collateral. He finally landed bank financing backed by an export contract.

So desperate for business was he early on that he agreed to make his 14-inch color televisions for $ 1.50 in profit apiece. He later made Sega game consoles, Philips video recorders and push-button mobile phones for Bharti Airtel Ltd., the country’s leading mobile operator.

Dixon’s fortunes began to improve in the 2000s, when a regional political party gave the company a contract to manufacture televisions for free distribution. “All I heard from policymakers was that India’s future was in software,” he said. Investors were skeptical early on too.

Dixon Industry

During Dixon’s road show ahead of its IPO, money managers argued that India simply couldn’t compete with China. Vachani eventually raised about 6 billion rupees, or $ 82 million. Dixon now makes television for Xiaomi Corp., washing machines for LG Electronics Inc. and lighting products for Philips. It began producing mobile phones in 2016 for brands like Panasonic Corp. and Samsung Electronics Co.

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