Dixon Technologies is exploring silicon photonics and advanced semiconductor packaging as it looks beyond conventional electronics manufacturing toward parts for artificial intelligence infrastructure. The plans were reported by News18 from comments by Vice Chairman and Managing Director Atul Lal during the company’s second-quarter fiscal 2027 earnings call, and they remain at an early stage.
Silicon photonics uses light to carry data, and it is drawing attention in data centres because AI workloads move large volumes of information between servers. Faster links between machines can cut delays inside a data centre, and optical parts sit at the centre of that work. The company is now weighing whether it can build a position in that supply chain from India, for Indian buyers and for buyers abroad.
What Dixon is weighing
The company is considering partnerships and acquisitions to build capability in high-speed optical transceivers and advanced packaging. Management is looking at optical transceivers operating at 800G and above, products that support high-speed data transmission between servers and other systems in AI data centres. The company has discussed an initial investment of Rs 50 crore to Rs 60 crore, while the broader expansion remains under evaluation.
The push would take the company into specialised, higher-margin manufacturing. Group Chief Financial Officer Saurabh Gupta said margins in advanced packaging and silicon photonics are very high, with the return on capital employed expected to remain close to the company’s existing higher-level profile. That comment gives a sense of why the company is interested, even though the work is far from its established assembly business.
No final investment commitment has been announced. The company has not confirmed customer orders for the proposed silicon photonics and advanced packaging businesses, and it has not set a final manufacturing timetable for them. Any reader tracking the plan should treat it as an exploration for now, not as a plant under construction.
The Gemtek venture Dixon has signed
One part of the move is already on paper. The company signed a joint venture agreement on 7 October 2026 with Taiwan-based Gemtek Technology to manufacture optical transceivers and other telecom products in India. The venture runs through Dixon Electroconnect, which is currently a wholly owned subsidiary of Dixon Technologies.
Under the agreement, the company will hold 60 percent of Dixon Electroconnect, while Gemtek will hold the remaining 40 percent through a subscription of fresh equity shares. The venture will manufacture and supply optical transceiver SFP products, meaning small form-factor pluggable modules, and BOSA products, meaning bidirectional optical subassemblies, along with other telecom products the partners agree on.
The partners expect the transaction to be completed by 3 February 2027, subject to the completion of customary conditions. The venture company had not started business operations as of 31 March 2026 and reported nil turnover, so the venture starts from a clean base rather than from an existing factory line. A binding term sheet for the venture was signed on 9 June 2026, before the October agreement.
Why Dixon wants higher-value parts
For Dixon, the attraction is a step up the manufacturing chain. The company built its name assembling consumer electronics at scale. Optical transceivers and advanced packaging sit closer to the components that decide how fast AI systems run, and they carry margins that assembly work rarely matches. Local production would also give global buyers a second source of supply outside their existing bases.
The timing fits a wider build-out of data centre capacity in India, where AI, cloud and edge computing are raising demand for high-speed networking. Whether Dixon can win orders in that market will depend on technology it does not yet hold at scale, on partners it has not yet named for the silicon photonics work, and on customers it has not yet disclosed. The Gemtek venture answers part of that question, since Gemtek brings experience in high-speed optical modules, telecom infrastructure and networking technologies.
Dixon has not announced a final investment commitment, a manufacturing timeline or confirmed customer orders for its proposed silicon photonics and advanced packaging businesses. The Gemtek venture has a signed agreement and a completion target, while the wider photonics plan is still being evaluated. That distinction is the clearest guide to where the story stands: one deal signed, and a larger ambition still being tested.