Avalon Technologies (AVALON IN) – Q1FY27 Result Update – Long-Term Growth Engines Continue to Accelerate – REDUCE
Published on 05 Aug 2026
Avalon Technologies (AVALON IN) has reported robust revenue growth of 49.8% YoY mainly driven from Clean Energy/Mobility/Industrial segments (grew by 141%/44%/~50% YoY). EBITDA margin expanded by 270bps to 12.0%. AVALON has revised FY27 revenue growth guidance upward to 26–30% from 24–27%, while maintaining gross margin guidance of 33–35%. US manufacturing losses narrowed to ~INR 38mn from ~INR 141mn in Q1FY26, with management expecting the business to breakeven during FY27 and contribute around 20% of total revenue over the long term. AVALON achieved its earlier target of doubling revenues from FY24 to FY27 nearly one year ahead of schedule and has set a target to further double revenues between FY26 and FY29. We have revised our FY27/FY28 EPS estimates upward by 5.1%/7.0%. We estimate Revenue/EBITDA/PAT CAGR of 31.8%/38.6%/38.9% over FY26-28E, with EBITDA margin expansion of 110bps. We maintained our ‘REDUCE’ rating (mainly due to higher valuation) with a TP of INR 1,470 (earlier INR 1,374), valuing at 45x FY28 earnings.
