Indian electronics manufacturing is getting a lot of attention lately, mostly because global buyers want reliable partners beyond the usual countries. Contract makers here are getting busier, and investors are trying to work out who can actually keep the pace. Some grow fast on paper but struggle with cash and margins. So it’s worth checking how one mid-sized player handled a very quick quarter.
Avalon Technologies is an electronics manufacturing services company that builds complex box build products for mission-critical uses. It serves industrial, mobility (rail and aerospace), clean energy, communication and medical customers. It has plants in India and the US, with exports making up 59% of Q1 revenue. Box build now makes up 59.9% of its business, up from 44.5% in FY22.
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Growth That Came Faster Than Planned
For the June 2026 quarter, revenue came in at ₹484 crore, up 50% from ₹323 crore a year back. Profit after tax jumped to ₹35 crore from ₹14 crore. EBITDA margin, which is basically operating profit as a share of sales, was 12% against 9.2% last year. Gross margin stayed at 34.7%, inside the usual 33 to 35% band. Because of this, the company lifted its FY27 revenue growth guidance to 26 to 30%, from 24 to 27% earlier.
The ₹3,200 Crore Revenue Goal
Avalon Tech had earlier promised to double sales from FY24 to FY27, roughly ₹1,734 crore. Trailing twelve month revenue already crossed that, nearly a year before the deadline. So the next target is doubling again, from ₹1,603 crore in FY26 to around ₹3,200 crore by FY29. It’s a big number, but they did the last one in two years, not three.
Semiconductor and Power Push
This is where the fresh excitement is. Avalon Technologies has raised its share of work with one of the world’s leading wafer fabrication equipment makers (the machines used in chip factories), moving beyond power box assemblies into other products. Revenue from semiconductor equipment and HVDC systems (high voltage direct current, used to move power over long distances) both started this quarter, and the ramp is expected in coming quarters.
Data centre power is also on the list, though rack and cooling wins haven’t come yet and server boards aren’t part of the plan. On ISM 2.0, the next phase of the India Semiconductor Mission, the company says it hasn’t seen the final details. A new Chennai plant starts commercial production from Q2 FY27, and a large land parcel there is being acquired.
Where the Numbers Pull Apart
Look at the order book and something odd shows up. It stood at ₹2,208 crore, up only 23.4%, while revenue grew 50%. The company says it only counts orders for a 14 month window here, and adds another ₹1,256 crore of longer contracts, so the three year picture is ₹3,465 crore. Fair enough, but the slower order growth is still worth watching.
Working capital is another one. Days improved to 117 from 142 a year ago, which is great, yet it actually rose from 112 days in March. New programs need more stock at the start, so that’s probably why.
Then there’s guidance. A 26 to 30% full year growth on ₹1,603 crore means roughly ₹2,020 to ₹2,084 crore. Take out Q1’s ₹484 crore and the rest of the year needs about ₹1,536 to ₹1,600 crore, so around ₹512 to ₹533 crore a quarter. That’s only a little above Q1. The company calls its guidance conservative.
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US Losses and India Margins
The US plant lost about ₹4 crore at PAT level, against ₹9 crore last year and ₹14 crore two years ago. It’s meant as a starting point where new customers get comfortable, before production moves to India. India manufacturing made a 16.7% EBITDA margin, and the company wants the US share to settle near 20% of revenue, though it was 28% this quarter. It also said EBITDA margin would have been roughly 0.9% higher without the tariff pass-through impact.
₹1,000 Cr JV
The Avalon Technologies–Zollner JV is planned as a high-precision electronics manufacturing platform in India, with a proposed ₹1,000 crore manufacturing facility in Kanchipuram, Tamil Nadu. The venture will manufacture printed circuit board assemblies (PCBAs), box-builds, cable harnesses and electronic sub-assemblies, targeting sectors such as healthcare, life sciences, test & measurement, rail and industrials.
Zollner will initially hold 51%, while Avalon will hold 49%; Avalon can potentially increase its stake to 51% after three years of commercial production, subject to conditions. Zollner brings 60+ years of EMS expertise and global customer relationships, while Avalon contributes its Indian manufacturing ecosystem. Importantly, Avalon will also supply the JV with cable harnesses, magnetics, plastics, sheet metal and machining, creating additional revenue opportunities.
Bottom Line
The June quarter looks strong, with growth, profit and margins all moving up together, and ROCE at 23.4%. The semiconductor and power orders give a real story beyond the base business. But slower order book growth, a working capital uptick since March and a guidance that looks cautious are things to keep an eye on. Honestly, the next two quarters will show whether the new programs ramp on time.