Avalon Technologies Limited — PPTs, 06-05-2025: Investor Presentation

1. Financial Highlights:

Avalon Technologies posted Q4 revenue of ₹343 Cr, up 58.1% YoY; FY25 revenue reached ₹1,098 Cr, a 26.6% increase. Gross margin dipped slightly to 35.1% in Q4 but stayed stable at 35.8% for FY25. EBITDA jumped 139.6% YoY in Q4 to ₹41 Cr, with margins improving to 12.1%; full-year EBITDA margin rose to 10.5% from 7.2%. PAT more than doubled in Q4 to ₹7 Cr (+243.8%), ending at ₹63 Cr for FY25 (+126.7%). RoCE remained healthy at 15.7%. Net working capital days improved from 161 to 124, reflecting better cash management. The order book is strong at ₹1,761 Cr, up 29% YoY.

2. Strategic Initiatives & Growth Drivers:

Capacity is expanding with a new export plant in Chennai and brownfield expansions underway. Avalon targets profitable sectors like aerospace and clean energy with high-mix, flexible-volume products. The hybrid manufacturing model spans India (87% revenue) and the US (13%), leveraging the China+1 strategy and benefiting from strong EMS sector growth (~32% CAGR in India). Collaboration with Zepco Technologies aims to boost service capabilities and market reach.

3. Business Developments:

Long-term contracts support strong revenue visibility over 14 months to 3 years. The company focuses on cross-selling via integrated design-to-box-build solutions. Vertical integration across PCB design, cable assemblies, plastics, magnetics, and box builds enhances its end-to-end EMS offerings.

4. Market Position & Competitive Advantage:

Avalon is the sole Indian EMS player with full-fledged US manufacturing, giving it a competitive edge to serve global clients. It leads in complex applications across aerospace, clean energy, medical, railways, and industrial sectors, backed by industry recognition. Its diversified, high-precision product portfolio and vertical integration provide scale, pricing power, and strong customer retention.

5. Investor Implications:

Strong top-line growth, margin expansion, and improved cash flows signal positive growth potential. Focus on high-growth sectors like clean energy and aerospace supports sustainable earnings upside. Execution risk includes managing rapid capacity scale-up and margin sustainability amid competition. Solid order book and strategic partnerships enhance visibility and market position, making Avalon a compelling play on India-US EMS growth.