Avalon Technologies Limited IPO

Apply 1
Avoid 0

Avalon Technologies is one of the leading fully integrated Electronic Manufacturing Services (“EMS”) companies with end-toend capabilities in delivering box build solutions in India.

Through a unique global delivery model, they provide a full stack product and solution suite, right from printed circuit board (“PCB”) design and assembly to the manufacture of complete electronic systems (“Box Build”), to certain global original equipment manufacturers (“OEMs”), including OEMs located in the United States, China, Netherlands and Japan.

Their capabilities include PCB design and assembly, cable assembly and wire harnesses, sheet metal fabrication and machining, magnetics, injection molded plastics and end-to-end box build of electronic systems. The company specializes in manufacturing and providing design support for critical integrated assemblies, sub-assemblies, components and enclosures for multiple industry verticals. The end-use industries they cater to include a mix of established and long product lifecycle industries, such as industrial, mobility and medical devices and high growth “sunrise” industries, such as solar, electric vehicles and hydrogen in the clean energy sector and digital infrastructure in the communications sector.

Certain of the key customers include Kyosan India Private Limited, Zonar Systems Inc., Collins Aerospace, e-Infochips Private Limited, The US Malabar Company, Meggitt (Securaplane Technologies Inc) and Systech Corporation, with whom they have had relationships for more than seven years.

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.

Each of their manufacturing facilities integrates manufacturing, warehousing and logistics. Their electronic manufacturing facilities comprise an aggregate of 65 production lines, consisting of ten Surface Mount Technology (“SMT”) lines, 12 Through Hole Technology (“THT”) lines and 43 assembly lines.

Competitive Strengths

i. End-to-end integrated solutions, providing a “One Stop Shop” for electronics and electro-mechanical design and manufacturing services
ii. High entry barriers to business through our collective cross-industry experience, customer engagement capabilities and leading position in the high mix flexible volume product manufacturing segment
iii. Well-diversified business leading to strong growth avenues

Objects of the Avalon Technologies Limited IPO:

1. OFS ( 625 Crores) 2. Fresh Issue (400 Crores) The Company proposes to utilize the Net Proceeds towards funding the following objects: i) Prepayment or repayment of all or a portion of certain outstanding borrowings availed by the Company and one of the Material Subsidiaries, i.e. Avalon Technology and Services Private Limited (ATSPL). ii) Funding the working capital requirements of the Company.

Avalon Technologies Limited IPO Details:

Open Date: Apr 03 2023
Close Date: Apr 06 2023
Total Shares: 23509174
Face Value: ₹ 2 Per Equity Share
Issue Type: Book Built Issue IPO
Issue Size: 1,025.00 Cr.
Lot Size: 34 Shares
Issue Price: ₹ 436 Per Equity Share
Listing At: NSE,BSE
Listing Date: Apr 14 2023

Promoters And Management:

i. Kunhamed Bicha is one of the Promoters and currently the Chairman and Managing Director of the Company. He co-founded Sienna and currently serves as its chief executive officer. He holds a bachelor’s degree in mechanical engineering from PSG College of Technology and a master’s degree in science (industrial engineering) from Wichita State University. He has been associated with the Company since its incorporation. ii. Bhaskar Srinivasan is one of the Promoters and currently the Non-executive Director of the Company. He cofounded Sienna and currently serves as its president. He holds a bachelor’s degree in mechanical engineering from Annamalai University, a master’s degree in business administration from Cochin University of Science and Technology and a master’s degree in science (industrial engineering) from Wichita State University. He has been associated with our Company since its incorporation. Prior to joining the Company, he was associated with Applied Materials, Inc. iii. Luquman Veedu Ediyanam is the Non-executive Director of the Company. He holds a bachelor’s degree in technology (branch II mechanical engineering) from University of Calicut. He has been associated with the Company since March 3, 2017. He currently is, and has been the legal partner and the managing director at Dhafir Technologies LLC, United Arab Emirates since its establishment in 1970.

Financials of Avalon Technologies Limited IPO:

(Fig. in Millions)
Years Mar-20 Mar-21 Mar-22
Sales ₹6,418.67 ₹6,904.71 ₹8,407.18
Sales Growth 0.00% 7.57% 21.76%
COGS ₹4,112.52 ₹4,559.99 ₹5,541.33
COGS % of Sales 64.07% 66.04% 65.91%
Gross Profit ₹2,306.15 ₹2,344.72 ₹2,865.85
Gross Margins 35.93% 33.96% 34.09%
Employee Benefit & Other Expenses ₹1,661.36 ₹1,683.28 ₹1,890.36
Employee & Other Expenses % 25.88% 24.38% 22.49%
EBITDA ₹644.79 ₹661.44 ₹975.49
EBITDA Margins 10.05% 9.58% 11.60%
Interest Cost ₹449.57 ₹269.94 ₹248.47
Interest %of Sales 7.00% 3.91% 2.96%
Depreciation ₹155.08 ₹157.47 ₹171.93
Dep %of Sales 2.42% 2.28% 2.05%
EBIT Margins 7.63% 7.30% 9.56%
Other Income 112.81 54.26 109.32
Earnings Before Tax ₹152.95 ₹288.29 ₹664.41
EBT % Sales 2.38% 4.18% 7.90%
Exceptional Items 0 0 199.9
Tax ₹29.69 57.47 182.67
Effective Tax Rate 19.41% 19.93% 27.49%
PAT 123.26 230.82 681.64
NPM 1.92% 3.34% 8.11%
No. of Equity Shares 64.18 64.18 64.18
Earning Per Share 1.92 3.60 10.62

Registrar of Avalon Technologies Limited IPO:

  1. Link Intime India Private Limited

Company Address:

Avalon Technologies Limited B – 7, First Main Road, MEPZ, Tambaram, Chennai – 600 045 Phone: +9144 42220 400 Email: investorsrelations@avalontec.com Websitehttp://www.avalontec.com/

Discussion on Avalon Technologies Limited IPO:

Leave a Reply