Avalon Technologies Q2 Results Review- Recovery In The US Business Drives Operating Performance: Motilal Oswal

Motilal Oswal Report

With U.S. operations now witnessing a healthy recovery and the Indian business experiencing growth, we expect Avalon Technologies Ltd.’s revenue and profitability to experience healthy improvement from H2 FY25 onwards.

We also believe the company’s long-term revenue trajectory will continue to be strong, backed by:

1. the addition of new customers in the US and Indian markets and

2. order inflows from high-growth/high-margin industries, such as Clean Energy, Mobility, and Industrials.

We estimate Avalon to post a CAGR of 31%/57%/83% in revenue /Ebitda /adjusted PAT over FY24-FY27 on account of strong growth and healthy order inflows. Reiterate Buy with a target price of Rs 920 (premised on 35 times FY27E earnings per share).

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