Avalon Technologies Conference call takeaways: Another conservative revenue guide

Research evidence excerpt

J P M O R G A N

Asia Pacific Equity Research

05 August 2026

Avalon Technologies

Conference call takeaways: Another conservative

revenue guide

The key takeaway from the earnings call was that management raised FY27

revenue guidance from 24-27% to 26-30%, given the strong 1Q (50% YY growth).

However, management cited that this guide is again conservative. We bake in 35%

revenue growth for FY27E. Gross margin guidance was maintained in the 33-35%

range. On project updates, the Kavach anti-collision system is on track for

commercial production, while semiconductor equipment production is expected to

ramp up over the next few quarters. Remain N.

Neutral

AVAL.NS, AVALON IN

Price (05 Aug 26):Rs1,823.20

Price Target (Jun-27):Rs1,650.00

IT Services, EMS, Telecom, and

Internet Research

Bhavik Mehta, CFA AC

(91-22) 6157-3871

J.P. Morgan India Private Limited, J.P. Morgan

Tower, Santacruz(E), Mumbai - 400098, SEBI

Registration: INH000001873, (91-22) 6157-3000.

Ankur Rudra, CFA

FY27 revenue guide upgraded, but again conservative. FY27 revenue

guidance was upgraded to 26-30% from 24-27% following strong 1Q growth

of 50%. This came in below our expectation of 30-35%. Management indicated

that the guidance is again conservative, implying potential upside. The order

book, which grew 23% YY, is well diversified across verticals.

GM guide maintained. Gross margin guidance was maintained at 33-35% for

FY27, as well as in the near term. Management highlighted that margins are a

function of the portfolio mix, so it will operate in this range, depending on

which vertical grows faster and which grows more slowly.

Updates on projects. The Kavach anti-collision system is on track for

commercial production. Semiconductor equipment production is expected to

ramp up over the next few quarters.

Remain N. We remain N, as the stock is up 57% since the last earnings in early

May (vs. Nifty +1%) vs. peers’ performance range of -15% to +34%, so it seems

to us to be baking in all the positives.

(65) 6801-3237

J.P. Morgan Securities Singapore Private Limited