Avalon Technologies IPO muted listing, debuts at par with issue price; falls 2% post listing

Avalon Technologies shares saw a flat debut at Rs 436 on the NSE amid a tepid domestic market.

Avalon Technologies IPO was booked 2.34 times by Day 3.

Avalon Technologies shares listed at Rs 436 on the NSE amid a flat domestic market. The share debuted at the same price as its issue price. The scrip touched a low of 2% at Rs 423. A positive/flat listing was expected as ahead of the market debut, Avalon Technologies shares were trading at a premium of Rs 7 in the grey market.

Avalon Technologies IPO of Rs 865 crore opened for subscription on 3 April and the issue has been booked 234% on day 3. Qualified institutional buyers (QIBs) subscribed for 3.77 times of their reserved portion. Retail investors bid for 0.88 times of the shares reserved for RIIs. The NII portion garnered 43% bids so far and is oversubscribed. 54.55% of the IPO is reserved for QIBs, while NIIs can bid for 27.44% and retail investors for the remaining 18.30%. The IPO closed for subscription on 5 April. Retail investors can apply for a minimum 34 shares in one lot, and a maximum of 13 lots with 442 shares, totalling to Rs 192,712. Following the issue, the promoters’ share in the company will be diluted from 70.75% to 51.24%.

Avalon Technologies is a fully integrated Electronic Manufacturing Services (EMS) company with end-to-end capabilities in delivering box build solutions in India, with a focus on high value precision engineered products. They also 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 global original equipment manufacturers (OEMs) located in the United States, China, Netherlands, and Japan. 

“Avalon Technologies Ltd. made its debut in the market at a listing price of 436. The company’s issue price was Rs 415-436, so shares are listed at par with no profit and no loss. Avalon Technologies is a fully integrated EMS company with end-to-end operations that deliver box-build solutions in India. The company operates in a business with high entry barriers and has a global delivery footprint. Despite its strong and stable financial performance, Avalon Technologies experienced a decline in its PAT margin during the first eight months of FY22 and currently has a high debt ratio. Investors with a high-risk tolerance may consider holding Avalon Technologies Ltd. shares long-term, with a recommended stop loss of around 405, which is the lower price band of the issue,” said Pravesh Gour, Senior Technical Analyst, Swastika Investmart following the listing.

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First published on: 18-04-2023 at 10:04 IST