Avalon Technologies IPO: GMP rises ahead of subscription opening. Check key details

The three-day initial public offering (IPO) of electronic manufacturing services firm Avalon Technologies will open for public subscription next week on Monday, April 3, 2023 and conclude on April 6, 2023. The company has fixed a price band of ₹415-436 a share for its ₹865-crore initial share sale. The bidding for anchor investors will open on March 31.

As per market observers, Avalon Technologies shares are commanding a premium (GMP) of ₹30 in the grey market today, up from ₹24 in the previous sessions. The shares of the company are expected to list on the leading stock exchanges BSE and NSE on Tuesday, April 18, 2023.

Avalon Technologies IPO comprises of ₹320 crore from the fresh issuance of equity shares and ₹545 crore through an Offer For Sale (OFS) of shares by promoters and existing shareholders.

The company aims to raise ₹865 crore as compared to ₹1,025 crore it planned to raise through the initial share sale. The proceeds from the fresh issue would be used towards debt payment, funding working capital requirements and general corporate purposes.

Avalon Technologies is an end-to-end electronic manufacturing service solutions provider with client list, including Kyosan India, Zonar Systems Inc, Collins Aerospace, eInfochips, The US Malabar Company, Meggitt (Securaplane Technologies Inc), Systech Corporation. Kunhamed Bicha and Bhaskar Srinivasan are the promoters of the company.

The company has 12 manufacturing units spread across the US and India, offering a wide range of services from cable assembly and wire harnesses to sheet metal fabrication, machining, magnetics, and injection moulded plastics.

“Avalon Technologies recorded revenue from operations of ₹840 crore for fiscal 2022, with an order book worth ₹1,039 crore as of June 30, 2022. Although the overall outlook for Avalon Technologies IPO is positive, investors should be cautious given the current market conditions. The electronics manufacturing industry is known for its volatility, and raw material costs may adversely affect the business. Investors should carefully evaluate the company's performance, financial health, and growth prospects before investing in the IPO,” said Krishna Raghavan- Founder at Unlistedkart.