Electrical Equipment Stock, Brokerage said with Buy rating- price will go up to ₹ 970

According to the latest report by Motilal Oswal Financial Services, Aloon Technologies Electronics Manufacturing Services (EMS) is a special India company in the sector, which also has strong manufacturing presence in the US. The company serves fast growing sectors like clean energy, medical technology and mobility. Among the first 9 quarters of FY25, the company received 62% of the total revenue from these sectors (it was 59% in FY24).

America’s tariff shocks China, relief to India

The US has imposed a 245% tariff on China, while India is relieved from tariffs by 9 July 2025. Even if India is imposed 26%tariff in future, it will still be much lower than China (245%), Vietnam (46%) and Taiwan (32%). In this situation, companies like Avlon can get the benefit of coming to India by shifting a business from the US. Avlon already has a manufacturing unit in the US, leading to the company on other competitors.

Fast in order book, increased demand from US clients

The company gets the most business from the US – 58% of the total sales came from there in 9mfy25. The order book has also reached ₹ 2,700 crore with an annual gain of 28%. The company has also completed the first phase of the Chennai plant in India, which focuses on exports. Through this, increasing demand from the US and other countries will be met in the coming times.

Railways and aerospace also expected

Aloon Technologies is working on the railway’s “armor” security system in India, which is considered to be a big business opportunity in future. Along with this, many major customers of the company are also expanding their projects rapidly. For example, the clean energy sector company Ohmium International has launched a gigafactory in Doddaballapur in Bangalore in July 2024, where 2 GW of electrolyzer systems will be prepared.

The US Sunrun company has stated in its FY25 result that it is planning to increase its storage capacity by 30% in the first half of the current financial year. At the same time, Collins Aerospace has launched a new unit spread over 70,000 sqft in August 2024, which will increase its production capacity by 50%. Given the strong growth of all these clients, Avlon has increased its revenue growth guidance from 16–20% to 22–24% for FY25.

Possibility of fast growth in future, advice to invest in share

Motilal Oswal believes that Avlon can become a strong player in the EMS sector in the coming years. The company’s strong presence of both US and India, the confidence of clients and the growing order book will help it to move forward. The company’s revenue between FY24 to FY27 is estimated to be increased from 30%, Ebitda 57% and PAT 80% CAGR. On this basis, the report has been given a target of ₹ 970 on the stock, which is the current price ₹ 827 more than 17%.

First Published – April 18, 2025 | 4:47 pm IST

Related post