Avalon Technologies shares surge 10% as Nomura raises target price on Zollner JV growth prospects

Fresh updates from the financial markets indicate that Avalon Technologies shares jumped more than 10 percent on Monday after brokerage Nomura boosted its target price on the electronics manufacturing services firm. The market watchers cited stronger long-term expansion prospects from its joint venture with Germany-based Zollner Elektronik AG.

The stock rose to as much as Rs 2,424 in afternoon trade, up 10.35 percent from the previous close. Avalon Technologies has surged around 172 percent so far in 2026, putting the stock just shy of tripling this year, even as the Nifty 50 has fallen around 9 percent. The firm’s market capitalisation has crossed Rs 16,000 crore.

Nomura maintained its ‘buy’ rating on Avalon and boosted its target price to Rs 2,767 per share, implying around 26 percent upside from the previous session’s closing price. The brokerage stated the Zollner joint venture would allow Avalon to expand into advanced electronics manufacturing services and improve its long-term expansion visibility. The JV will additionally give it access to global customers and a wider European presence.

The partnership additionally opens up new verticals such as healthcare and life sciences and test and measurement, which Nomura stated involve high-complexity manufacturing and typically have long product lifecycles.

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Avalon recently entered into a joint venture with Zollner Elektronik AG to manufacture printed circuit board assemblies, or PCBAs, box-build products and system integration products in India. The venture will cater to customers across healthcare and life sciences, test and measurement, rail and other industrial sectors.

Zollner will initially own 51 percent of the venture, with Avalon holding the remaining 49 percent. Three years after commercial production begins, Avalon will have the option to acquire an additional 2 percent stake, which would make it the majority shareholder.

The JV will initially focus on serving the Indian operations of Zollner’s established customers and providing localisation backing. Avalon will additionally supply the venture through several of its existing capabilities, including cable wiring and harnesses, magnetics, plastics, sheet metal and machining.

Nomura estimates investment in the JV at $30-50 million. At the midpoint of $40 million, the brokerage stated that assuming asset turns of 10 times and EBITDA margins of 15-17 percent, the venture could lift Avalon’s FY29 earnings per share by around 21 percent.

Nomura additionally highlighted Zollner’s scale and customer base. The privately held German firm operates across multiple international locations and is involved in complex EMS manufacturing for sectors such as semiconductors, railways, aerospace and automotive. According to the brokerage, Zollner recorded topline of around $3.7 billion in 2025 and counts firms such as BMW, Bosch, Teradyne, Siemens and National Instruments among its customers.