Dixon Technologies on Monday said its wholly-owned subsidiary Padget Electronics has won a contract from Lenovo to manufacture its laptops and notebooks, under the IT hardware production-linked incentive (PLI) 2.0 scheme.

“This will give a strong impetus to India’s manufacturing competitiveness. Lenovo will bring in the global know-how and processes to manufacture IT hardware products,” said Atul B Lall, vice-chairman & managing director of Dixon Technologies.

While the contract is subject to signing of a definitive agreement, for Dixon, the same from Lenovo will be crucial, given that the company has already been manufacturing notebooks for Acer in the segment.

The company will also soon come up with a new facility in the next one year to manufacture smartphones and IT hardware and that will be built across 1 million square feet, Sunil Vachani, executive chairman of Dixon Technologies, had said last month.

In India, Lenovo has a 17% market share in the laptop/personal computers (PCs) segment, which puts it at the second spot after HP, according to estimates from IDC. The company shipped around 764,000 PC units in the July-September quarter, a fall of 9% year-on-year owing to weak demand, according to IDC.

The company also has its own PC manufacturing unit in Puducherry. Besides, it also locally manufactures its tablet computers, in partnership with Wingtech Technology, at a plant in Tirupati, Andhra Pradesh.

In the smartphone business, the company owns the Motorola brand, and has tied-up with Dixon Technologies for its manufacturing in India.