Avalon Technologies set to launch in secondary market: a quick guide

Avalon Technologies set to launch in secondary market: a quick guide

Avalon Technologies to Make its Debut on BSE and NSE Today

Avalon Technologies Limited, a leading technology company, is all set to make its debut on the Indian exchanges (BSE and NSE) on 18th April 2023, as per the information available on the official website of BSE. The equity shares of the company shall be listed and admitted to dealings on the exchanges in the ‘B’ group of securities.

The company recently went public with a public issue worth ₹865 crore. However, the issue received a lackluster response from investors across categories due to its high pricing. According to primary and secondary market experts, the IPO’s higher valuation may prevent the allottees from receiving a higher premium, resulting in a flat debut for Avalon Technologies shares on Dalal Street today.

Primary market experts predict that the listing price for Avalon Technologies IPO would be around ₹446 per equity share, with shares of the company available at a premium of ₹10 in the grey market today. Speaking on the IPO listing, Abhay Doshi, Founder at UnlistedArena.com, said that “the IPO of Avalon Technologies received a lackluster response across all categories. While the company has reported attractive margins compared to its peers, the IPO pricing was bit expensive, leaving little for investors on the table.”

A. R. Ramachandran, Co-founder & Trainer at Tips2trades, expects a further dip in the Avalon Technologies share price after the flat listing. Ramachandran advises a ‘buy on dips’ strategy post-listing in the scrip as he expects the Avalon Technologies shares to make further lows after listing. Despite the company’s excellent fundamentals in terms of profitability and return ratios, its PE ratio of above 50 in the current environment looks expensive.

Grey Market Indicates Flat Listing for Avalon Technologies IPO

As per market analysts, Avalon Technologies IPO’s Grey Market Premium (GMP) signals a neutral listing today. The current GMP is ₹10, indicating that the unlisted share market expects the listing price to be around ₹446, which is approximately 2% higher than the IPO price band of ₹415 to ₹436 per equity share.

The management of Avalon Technologies has stated their intention to utilize the net proceeds generated from the public issue to repay either all or a portion of their outstanding borrowings, including those of their subsidiary, Avalon Technology and Services. Additionally, the company plans to allocate fresh capital proceeds towards funding their working capital requirements and other general corporate purposes.

Avalon Technologies IPO Subscribed 2.34 Times on Strong QIB Response

During the three-day bidding period from April 3rd to 6th, 2023, the Avalon Technologies IPO received a subscription rate of 2.34 times due to the significant response from QIB category investors. The QIB category was subscribed 3.77 times, while the retail portion was subscribed 0.88 times. On the other hand, the NII segment’s subscription rate was 0.43 times.

About Avalon Technologies:

Avalon Technologies, established in 1999, provides end-to-end box-build solutions in India, with a particular emphasis on high-value precision-engineered products. The company has 12 manufacturing units distributed throughout the United States and India, offering an array of services and solutions to its customers.

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