Avalon Technologies IPO to open on April 3

The initial public offering (IPO) of Avalon Technologies will kick off at Dalal Street for subscription on Monday, April 3, 2023. The electronics maker will be selling its shares in the range of Rs 415-436 apiece during the four-day bidding process which concludes on Thursday, April 6, 2023.

Incorporated in 1999, Avalon Technologies is a fully integrated electronic manufacturing services (EMS) company, which has end-to-end capabilities in delivering box-build solutions in India, focusing on high-value precision-engineered products.

The company is looking to raise Rs 865 crore via its primary stake sale, including a sale of up to 7,339,450 fresh equity shares aggregating to Rs 320 crore while existing shareholders and promoters will offload 12,500,000 equity shares amounting to Rs 545 crore through an offer for sale (OFS).

Promoters Kunhamed Bicha and Bhaskar Srinivasn will offload shares via the OFS route. From the promoter group TP Imbichammad and Mariyam Bitch, along with other shareholders including Anand Kumar, Sareday Seshu Kumar and Luquman Veedu Ediyanam will also participate in OFS.

Net proceeds from the fresh issue will be utilized towards the prepayment or repayment of all or a portion of certain outstanding borrowings availed by the company and one of the materials subsidiaries; funding the working capital requirements and general corporate purposes. Proceeds from OFS will go to the selling shareholders.

Avalong Technologies has fixed the lot size at 34 equity shares, which would cost Rs 14,824 to the investors. Retail investors can bid for a maximum of 13 lots or 442 equity shares. The Anchor book will open on Friday, March 31, 2023.

Avalon Technologies counts Kyosan India, Zonar Systems Inc, Collins Aerospace, e-Infochips, The US Malabar Company, Meggitt (Securaplane Technologies Inc) and Systech Corporation as some of its key clients. It has 12 manufacturing units located across the US and India.

Its offerings 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.

For the period ended on March 31, 2022, the company reported a total revenue of Rs 851.65 crore with a profit after tax (PAT) of Rs 68.16 crore. It had an order book worth Rs 1,039 crore as of June 30, 2022.

The company has reserved 75 per cent of the shares for qualified institutional bidders, whereas 15 per cent shares will be allocated to non-institutional investors (NIIs). Retail investors will get the remaining 10 per cent of the shares.

JM Financial, DAM Capital Advisors, IIFL Securities and Nomura Financial Advisory & Securities (India) are the book-running lead managers to the issue, whereas Link Intime India has been appointed as the registrar to the issue. The stock will be listed at both BSE and National Stock Exchange (NSE). BusinessToday