1. At a Glance

Avalon Technologies Ltd, the fully integrated Electronic Manufacturing Services (EMS) player, just dropped its Q2FY26 mixtape — and it’s got all the beats: revenue up39.1% YoYto ₹382 crore, profit after tax (PAT) up42.9% YoYto ₹25 crore, and a P/E ratio that’s currently auditioning for the next Elon Musk mission at87.7x.

At amarket cap of ₹7,674 croreandstock price of ₹1,150, Avalon has been on a caffeine overdose —95% return in the past year. The company’sROCE stands at 12.8%,ROE at 10.4%, anddebt-to-equityis a healthy 0.25.

But don’t get too comfortable — this is one of those “looks stable till the CFO resigns” stories. With multiple resignations in FY25 (CFO and Company Secretary both exited) and promoter holdings quietly dipping from50.9% to 44.5%, this tech assembler from Chennai is showing its cards — and a few stress wrinkles too.

Still, a₹1,244 crore order bookand tie-ups insupercomputing (C-DAC’s RUDRA Program)suggest Avalon is not just soldering boards — it’s soldering the future.

2. Introduction – From Chips to Chutzpah

If you’ve ever wondered what happens when Tamil Nadu’s manufacturing muscle meets Silicon Valley’s startup swagger, Avalon Technologies is your answer — a hybrid child assembling PCBs by day and dreaming of NASDAQ by night.

Incorporated in 1999, Avalon has quietly built a presence across India and the US, becoming one of the very few Indian EMS firms withmanufacturing bases in Atlanta and Fremont. Think of it as a desi Foxconn — but with more humidity and fewer trade wars.

The company’s Q2FY26 results were basically a flex.Revenue up 39.1% YoY,PAT up 42.9%, and anoperating profit of ₹39 crorewith margins hovering around10%. Sure, it’s not TCS margin-level glory, but when your clients includeCollins Aerospace, Kyosan, Zonar Systems, and eInfochips, you don’t need to shout — your invoices do the talking.

Still, investors might ask — if everything’s this shiny, why no dividends since birth? And why does Avalon’sEV/EBITDAlook like a SpaceX altitude —46.5x?

Because Avalon is in the “growth phase,” darling. Which is corporate code for:“We’re buying soldering machines, not paying you cash.”

3. Business Model – WTF Do They Even Do?

Alright, grab a cup of filter coffee and let’s decode Avalon’s business in simple words:

They’re not a gadget brand. They’re theinvisible hands behind the gadgets— manufacturing printed circuit boards (PCBs), cable assemblies, metal housings, plastic enclosures, transformers, and full-fledged electronic systems.

In short — if your product blinks, beeps, or buzzes, Avalon probably built it.

Theirproduct portfoliocovers:

• PCB Design & Assembly
• Cable Assembly & Wire Harnesses
• Sheet Metal Fabrication
• Transformers, Chokes, and Inductors
• Injection Moulded Plastics
• Box Builds (complete electronic systems)

Avalon works across industries that don’t go obsolete every TikTok trend —industrial, clean energy, mobility, communications, and medical devices. In fact, inH1FY24, 35% of revenue came from industrial clients, and another 27% from mobility/transportation.

Theirrevenue split FY23:

• Box Build – 54%
• PCB – 28%
• Cables – 9.5%
• Metals – 4%
• Magnetics – 2.5%
• Design – 2%
• Plastics – 1%

They even supply toC-DAC’s RUDRA Supercomputer program, which means somewhere inside a government lab, a Tamil Nadu-made circuit is busy crunching data faster than Indian bureaucracy can approve a file.

The cherry on top?14 manufacturing units, 66 production lines, and presence in bothIndia and the US— the only Indian EMS player with that global footprint.

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