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Avalon Technologies Limited plans to raise Rs 865 crore through an initial public offering. The subscription for the IPO opens on April 3, 2023, and closes on April 6, 2023. The price band is fixed at Rs 415 – Rs 436 per equity shares. The face value is set at Rs 2 per share.
The IPO comprises of fresh issue of equity shares worth Rs 320 crore and Offer For Sale (OFS) worth Rs 545 crore. The lot size is 34 shares.
Company Summary
Avalon Technologies Limited is one of the leading fully integrated electronic manufacturing services companies with end-to-end operations in delivering box build solutions in India, with a focus on high value precision engineered products.
The company provides a full stack product and solution suite, from printed circuit board design and assembly to end-to-end box build of electronic systems, to global original equipment manufacturers present in the United States, China, Netherlands and Japan. The company’s other capabilities include cable assembly and wire harnesses, sheet metal fabrication, machining, magnetics and injection molded plastics.
The company has established strong relationship with key clients including Kyosan India Private Limited, Zonar Systems Inc., Collins Aerospace, e-Infochips Private Limited, The US Malabar Company, Meggitt (Securaplane Technologies Inc) and Systech Corporation. The company provides services to various industries such as Clean Energy, Mobility/Transportation, Industrial, Communication and Medical.
The company said that its key customer base has increased from 72 as of November 30, 2021 to 89 as of November 30, 2022. The company’s order book has increased from Rs 9,182.32 million as of November 30, 2021 to Rs 11,902.46 million as of November 30, 2022.
Avalon Technologies have 12 manufacturing units located across the United States and India: one unit in Atlanta, Georgia, one unit in Fremont, California, seven units in Chennai, Tamil Nadu, one unit in Kanchipuram, Tamil Nadu and two units in Bengaluru, Karnataka. In addition, the company has a new facility in Chennai, Tamil Nadu, which is currently under construction and renovation.
Further, Avalon Technologies stands to benefit from the tailwinds of Aatmanirbhar Bharat and the Production Linked Incentive Scheme (“PLI Scheme”) across verticals, which would help to reduce import dependence as well as position India as an export hub.
Avalon Technologies’ listed industry peers include Dixon Technologies, Amber Enterprises India Limited, Elin Electronics, Syrma SGS Technology Limited and Kaynes Technology India Limited.
Company Strengths
- End-to-end integrated solutions provider with a one-stop shop for electronics and electro-mechanical design and manufacturing services.
- High entry barriers for new entrants and the company’s strong experience in offering EMS services across product and industry verticals for customers globally for several years.
- One of the leaders in high mix, flexible volume product manufacturing.
- Well-diversified business leading to strong revenue growth avenues.
- Well-established relationships with marquee client base.
- Global delivery footprint with high quality standards and advanced manufacturing as well as assembly capabilities.
- Strong track record of sustained growth in revenue, profitability and stable cash flows.
Company Financials
Period | 8MFY23 | FY22 | FY21 | FY20 |
Total Assets (Rs in crore) | 703.03 | 587.96 | 512.48 | 449.65 |
Total Revenue (Rs in crore) | 596.98 | 851.65 | 695.9 | 653.15 |
Profit After Tax (Rs in crore) | 34.19 | 68.16 | 23.08 | 12.33 |
PAT Margin (%) | 5.73% | 8.00% | 3.32% | 1.89% |
EBITDA (Rs in crore) | 68.06 | 97.55 | 66.14 | 64.48 |
EBITDA Margin (%) | 11.64% | 11.60% | 9.58% | 10.05% |
Order Book (Rs in crore) | 1,190.25 | 857.87 | 634.58 | 504.67 |
Purpose of the IPO
- The net proceeds from the fresh issue of shares totalling Rs 145 crore will be utilised for prepayment or repayment of all or a portion of certain outstanding borrowings availed by the company and one of their subsidiaries — Avalon Technology and Services Private Limited.
- The net proceeds from the fresh issue of shares aggregating to Rs 90 crore will be utilised for funding the working capital requirements of the company.
- The net proceeds will also be used for general corporate purposes.
- The proceeds of the Offer For Sale (OFS) totalling Rs 545 crore shall be received by the selling shareholders and will not form part of the net proceeds. Each selling shareholder will be entitled to their respective portion of the proceeds of the OFS after deducting its respective proportion of the offer expenses and relevant taxes.
Company Promoters
Kunhamed Bicha and Bhaskar Srinivasan are the promoters of the company.
IPO Details
IPO Opening Date | April 3, 2023 |
IPO Closing Date | April 6, 2023 |
Face Value | Rs 2 per share |
Price Band | Rs 415 to Rs 436 per share |
Lot Size | 34 shares |
Total Issue Size | 1,98,39,450 shares aggregating up to Rs 865 crore |
Fresh Issue | 73,39,450 shares aggregating up to Rs 320crore |
Offer For Sale | 1,25,00,000 shares totalling up to Rs 545 crore |
Issue Type | Book Built Issue IPO |
Listing At | BSE, NSE |
IPO Lot Size
Application | Lots | Shares | Amount |
Retail (Minimum) | 1 | 34 | Rs 14,824 |
Retail (Maximum) | 13 | 442 | Rs 1,92,712 |
Small HNI (Minimum) | 14 | 476 | Rs 2,07,536 |
Small HNI (Maximum) | 67 | 2,278 | Rs 9,93,208 |
Large HNI (Minimum) | 68 | 2,312 | Rs 10,08,032 |
Allotment Details
Event | Date |
Basis of Allotment | April 12, 2023 |
Initiation of Refunds | April 13, 2023 |
Credit of Shares to Demat Account | April 17, 2023 |
Listing Date | April 18, 2023 |
To check allotment, click here