Avalon Tech shares fall 6% after Rs 883 crore block deal; 3 promoter entities likely sellers

Avalon Technologies' shares plunged 6% to Rs 2,171 on the BSE after a significant block deal worth Rs 883 crore. The trade, involving around 40.5 lakh shares or 6.06% of the company's total equity, saw shares changing hands at an average price of Rs 2,181 each. According to media reports, three promoters - Bhaskar Srinivasan, BBS Family Trust, and KBS Family Trust - were selling up to 6% of the company's existing shares.

The transaction's value was estimated between Rs 861.9 crore and Rs 922 crore. These sellers will be bound by a 180-day lock-up period on any further share sales. As of the June quarter, promoters owned 44.39% of Avalon Technologies, with Bhaskar Srinivasan holding 9.39%, and BBS Family Trust and KBS Family Trust each owning 3.02%.

The remaining 55.61% was held by public shareholders. Recently, Nomura upgraded its target price on Avalon Tech shares to Rs 2,767 from Rs 2,211, suggesting a 23% upside from the current levels. Nomura highlighted Avalon's recent joint venture with Zollner Elektronic AG, a European EMS leader, to manufacture PCBA, box-build, and system integration in India.

This JV aims to serve various sectors including healthcare, life sciences, test and measurement, and rail, providing Avalon with access to global customers and expansion opportunities in new verticals.