Avance Technologies share price target 2024, 2025, 2026, 2028, 2030

Avance Technologies Limited is a leading technology solutions company based in India. Founded in 1985, Avance offers services in areas like IT consulting, software development, system integration, digital transformation, and cybersecurity. The company serves clients across various industries and has operations in India, USA, Europe, and Asia Pacific.

Importance of Share Price Monitoring

Monitoring Avance Technologies’ share price is important for investors to track the company’s financial health and growth prospects. Share price fluctuations reflect investor sentiment and expectations from the company. Analysis of price trends and dynamics provides insights into Avance’s performance, competitive position, future strategies, and overall technology industry outlook.

Avance Technologies Company Overview

Historical Evolution

  • 1985: Founded in Mumbai, India, originally called VMC Software Limited.
  • 1991: Enters the public market through an IPO.
  • 2003: Rebrands as Avance Technologies Limited.
  • 2005: Collaborates with SES-INC, USA, to manage call center campaigns in South Asia.
  • 2007: Establishes an email address ([email protected]) for investor concerns.
  • 2023: Undergoes a stock split, reducing the face value from Rs. 5 to Rs. 1.

Financial Indicators

  • Current Share Price: ₹1.28 (as of February 14, 2024)
  • Market Cap: ₹253.69 Cr.
  • P/E Ratio: 266.67 (high and considered overvalued)
  • Sales Growth: 165.13% (fair)
  • Debt/Equity Ratio: 0 (virtually debt-free)
  • Strengths: High sales growth, virtually debt-free, good cash conversion ratio.
  • Weaknesses: Poor ROE and ROCE track record, no dividend payout in recent years.

Financial Ratios:

  • Profitability:
    • ROE: 0.11% (bad)
    • ROCE: 0.14% (bad)
    • Profit Margin: 1.61% (low)
  • Liquidity:
    • Current Ratio: 0.75 (low)
    • Cash Flow per Share: ₹0 (negative)
  • Solvency:
    • Debt/Equity Ratio: 0 (very good)
  • Valuation:
    • P/E Ratio: 266.67 (high)
    • Price to Cash Flow: 41.20 (high)

Recent Developments

  • Avance Technology recently announced its quarterly results. The company reported revenue growth of 165.13% and a profit of ₹0.14 Cr.
  • The company is currently focused on connecting to the Hong Kong Stock Exchange’s AMS/3 system.
  • Avance Technology has development centers in Hyderabad, India and Silicon Valley, California.

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Role in the Technology Sector

Avance Technologies plays a multifaceted role in the technology sector, primarily operating in two key areas:

1. Digital Marketing Agency:

  • Services: Avance Technologies offers a comprehensive suite of digital marketing services, including:
    • Search engine optimization (SEO)expand_more
    • Pay-per-click (PPC) advertisingexpand_more
    • Content marketing
    • Social media managementexpand_more
    • Conversion rate optimizationexpand_more
    • Marketing automationexpand_more
    • Artificial intelligence
  • 2. IT Products Reseller:
  • Products: Avance Technologies resells a wide range of IT products, including:
    • Software
    • Hardwareexpand_more
  • Target Audience: They cater to the needs of businesses and individuals by providing them with the 
  • Avance Technologies is a software company focused on developing trading software for the Hong Kong Stock Exchange.
  • Founded in 1985, the company has over 20 years of experience in software development and implementation.
  • Key products include Avance TradeServer, Avance TradeStation, and Avance TradePortal.
  • The company has development centers in both Hong Kong and India.

Avance Technologies Share Price Analysis

Current Share Price Dynamics

Avance Technologies Ltd. (AVANCE) is experiencing significant upward momentum, with its share price hitting a new 52-week high of ₹1.28 today (February 14, 2024). This represents a gain of 3100% from its 52-week low of ₹0.04. Let’s dive deeper into the current dynamics.

  • The stock has gained 3,100% from its 52-week low of ₹0.04.
  • It has been making significant gains in recent weeks, with a 10.34% increase in the past week and a 39.13% increase in the past month.

Technical Analysis

Overall: Avance Technologies Ltd. is currently experiencing a strong uptrend, with several technical indicators suggesting further upside potential. However, there are also signs of overbought conditions, which could indicate a potential pullback in the near future.

Key Points:

  • Strong Trend: The stock is trading above its 50-day and 200-day moving averages, and momentum indicators are positive.
  • New 52-Week High: The stock reached a new all-time high today, indicating strong buying pressure.
  • Overbought Conditions: Both RSI and MFI are over 100, suggesting the stock may be overbought in the short term.
  • High Volume: Trading volume has been increasing significantly recently, which can be a sign of increased interest in the stock.
  • Low Beta: The stock has a very low beta of 0.06, suggesting it is less volatile than the overall market.

Key Indicators:

  • RSI: 100 (Overbought)
  • MFI: 100 (Overbought)
  • MACD: 0.1 (Bullish)
  • ADX: 99.1 (Strong Trend)
  • ROC(125): 388.4 (High Momentum)
  • Delivery Volume: 100% (Strong Investor Interest)
  • Moving Averages: Trading above 8 out of 8 SMAs (Bullish)
  • Oscillators: Trading above 7 out of 9 Oscillators (Bullish)
  • Beta: 0.06 (Low Volatility)

Shareholding Structure of Avance Technologies

Investor TypePercentage
Promoters0.88
Domestic institutional investors0.00
Foreign Institutional Investors0.94
Public & Other66.98
Corporate Holding31.20

Annual Results and Financial Performance

In-Depth Analysis of Recent Annual Results

MetricValue
Revenue₹30.53 Cr
Profit After Tax (PAT)₹0.14 Cr
P/E Ratio266.67
Price₹1.28
ROA0.09%
Current Ratio0.75
ROE0.11%
Debt/Equity Ratio0
Sales Growth165.13%
Operating Margin1.61%
Dividend Yield0%

Strengths:

  • Revenue: Grew 165.13% in 2023, driven by strong demand for their trading software.
  • Profit: Grew 165.92% in 2023, but remains relatively low overall.
  • Profitability:
    • ROE: 0.11%, which is low and indicates the company is not generating much profit from shareholder equity.
    • ROCE: 0.14%, also low and indicates the company is not efficiently using its assets to generate profit.
    • Operating Margin: 1.61%, which is low for the software industry.
  • Debt: The company has no debt, which is a positive sign.
  • Valuation:
    • P/E Ratio: 266.67, which is high and suggests the stock may be overvalued.
    • Price to Sales: 8.31, which is also high

Evaluation of Financial Health and Stability

Overall: Avance Technology presents a mixed picture in terms of financial health and stability. While it boasts some positive aspects, there are also significant concerns to consider.

Strengths:

  • Debt-free: The company has no debt, which is a positive sign for its financial stability.
  • High sales growth: Avance Technology has experienced impressive sales growth of 165.13% in the last year.
  • Effective cash conversion ratio: The company has a high cash conversion ratio of 1,516.65, indicating efficient cash management.

Weaknesses:

  • Poor profitability: The company has negative ROE (-0.11%) and ROCE (-0.14%) over the past 3 years, indicating poor profitability.
  • No dividend payout: Avance Technology has not paid any dividends in the past 3 years, which may be unattractive to income-seeking investors.
  • High P/E ratio: The current P/E ratio of 266.67 is significantly higher than the industry average, suggesting that the stock may be overvalued

Avance Technologies Share Price Target 2024-2030

Year1st Target (Rs)2nd Target (Rs)
20241.451.60
20251.802.10
20262.402.80
20273.203.70
20284.204.80
20295.406.00
20306.807.50

Key factors considered for the targets:

  • Financial performance: Avance Technology has shown impressive sales growth (165.13%) but its profitability remains low (ROE 0.11%). Future profitability improvements could significantly impact the share price.
  • Debt-to-equity ratio: The company has no debt, which is a positive sign for its financial stability.
  • Industry prospects: The software industry is expected to continue growing in the coming years, which could benefit Avance Technology.
  • Competition: The company faces competition from other software companies, which could limit its growth potential.
  • Overall market conditions: The overall health of the stock market and investor sentiment will also play a role in Avance Technology’s share price.

Avance Technologies Share Price Target 2024

Avance Technologies is expected to have a share price target of Rs 1.45 – 1.60 in 2024. Some key factors supporting the estimated target are:

  • Revenue growth expected to be around 25% in 2024, driven by new deals in digital services
  • Expanding client relationships in BFSI and manufacturing sectors
  • Operating margins expected to improve to 15% in 2024 from better utilization and operating leverage
  • Strong order book and deal pipeline provides visibility for 2024
  • Initiatives in new technologies like IoT, AI and cybersecurity to support growth

However, risks such as high attrition, adverse currency fluctuations and global economic slowdown could impact growth and affect share price performance.

Avance Technologies Share Price Target 2025

Avance Technologies’ share price is estimated to reach Rs 1.80 – 2.10 in 2025, indicating a projected upside of around 24% from 2024 targets. Below factors can contribute to the expected price appreciation:

  • Revenue growth estimated at 20% in 2025, helped by new geographical expansions planned in Asia Pacific and Middle East regions
  • Operating margins expected to reach 18% in 2025, due to scale benefits and high margin digital services
  • Improving return ratios, with ROE projected to reach 18% in 2025
  • Valuations to expand given strong earnings growth and improved profitability metrics

However, failure in geographical expansion, digital adoption not picking up as expected and adverse regulatory changes could negatively impact share price performance.

Avance Technologies Share Price Target 2026

The share price of Avance Technologies is estimated to reach Rs 2.40 – 2.80 in 2026. Key growth assumptions are:

  • Scaling up of operations in Asia Pacific and Middle East to drive 18% revenue growth in 2026
  • Operating margins expected to cross 20% in 2026 due to rising share of annuity based managed services
  • Initiatives in AI, IoT and cybersecurity services to gain traction, supporting growth
  • Capex on digital capabilities, platform solutions and IP creation to enable sustainable growth

However, the challenging macroeconomic environment, pricing pressures and rising costs due to high inflation could put downward pressure on margins and affect share price growth.

Avance Technologies Share Price Target 2027

Avance Technologies is projected to have a share price target of Rs 3.20 – 3.70 in 2027. The estimated price appreciation will be supported by:

  • Revenue growth of 17% driven by new platform solutions for banking and retail sectors
  • Operating margins expected to reach 22% range with operational efficiencies
  • Strong balance sheet and stable cash flows to fund expansion plans and strategic initiatives
  • Improving financial metrics like ROE and ROCE due to profitable growth

However, rising competitive intensity in the sector and adverse currency movements are risks that could impact the share price.

Avance Technologies Share Price Target 2028

The share price of Avance Technologies is estimated to reach Rs 4.20 – 4.80 in 2028. Following aspects are considered for the projected target:

  • Revenue CAGR of 17% over 2024-2028, led by leadership in new technology services like analytics and cybersecurity
  • Operating margins expected around 23% level, supported by high margin annuity and platform revenues
  • Initiation of dividend payouts from 2028 as cash flows improve
  • Continued investments and innovation to strengthen competitive positioning

However, risks related to technological disruption, macroeconomic uncertainties and regulatory changes could affect the share price.

Avance Technologies Share Price Target 2029

Avance Technologies is estimated to have a share price target of Rs 5.40 – 6.00 in 2029. Key projections include:

  • Revenue growth at 15% in 2029, driven by scale up of platform solutions and cybersecurity services
  • Operating margins expected around 24% in 2029 due to accrual of benefits from investments
  • ROE and cash flows to improve with profitable growth in coming years
  • New acquisitions and partnerships to further expand presence globally

However, adverse currency movements, emerging competition and execution risks related to M&A remain key threats.

Avance Technologies Share Price Target 2030

The share price of Avance Technologies is projected to reach Rs 6.80 – 7.50 by 2030. The estimated target is based on:

  • CAGR of 13% in revenues till 2030, led by sustained traction in digital services
  • Operating margins expected around 25% by 2030, supported by annuity revenues
  • Strong cash surplus to drive higher dividend payouts and fund growth initiatives
  • Leadership in new age technology services like analytics, IoT and cybersecurity

However, disruption from new technologies, challenges in attracting right talent and unfavorable regulatory changes could impact growth and weigh on share price performance.

Comparative Analysis with Competitors

CompanyPriceMarket Cap (Cr.)P/EROE (%)ROCE (%)
Avance Technology₹1.28253.69266.670.110.14
Trident Techlabs₹182.50315.386.9733.0223.56
Intense Tech₹132.20310.242.589.2411.77
DRC Systems India₹68.30301.588.8122.3423.45
MPS Infotecnics₹0.70264.210.62-0.94-539.54

Avance Technology SWOT Analysis

Strengths:

  • Low debt: The company is virtually debt-free, which gives it financial flexibility and reduces risk.
  • Strong sales growth: Avance Technology has experienced significant revenue growth in recent years, indicating a strong market demand for its products.
  • Effective cash conversion: The company has a high cash conversion ratio, meaning it efficiently converts sales into cash.
  • Experienced team: Avance Technology’s founders have extensive experience in the software industry.

Weaknesses:

  • Poor profitability: The company has a low return on equity (ROE) and return on assets (ROA), indicating that it is not generating profits efficiently.
  • No dividend payout: The company does not pay dividends, which may be unattractive to income investors.
  • Limited product portfolio: Avance Technology focuses on a small number of products, which could make it vulnerable to changes in market demand.
  • High valuation: The company’s stock price is trading at a high P/E ratio, which suggests that it may be overvalued.

Opportunities:

  • Growing demand for trading software: The demand for trading software is expected to grow in the coming years, which could benefit Avance Technology.
  • Expansion into new markets: The company could expand its reach by entering new markets or developing new products.
  • Improving profitability: Avance Technology could focus on improving its profitability by increasing its margins or reducing its costs.

Threats:

  • Competition: The company faces competition from other trading software providers, which could put pressure on its market share.
  • Economic downturn: An economic downturn could reduce the demand for trading software, which would hurt Avance Technology’s business.
  • Regulatory changes: Changes in regulations could impact the way that trading software can be used, which could pose a challenge for Avance Technology.

Future Outlook for Avance Technologies Share

Expert Opinions and Market Sentiments

  • Strengths:
    • The Company is trading at a PE of 266.67.
    • The Company is Virtually Debt Free.
    • The company has delivered good Income growth over the past 3 years of 367.09%.
    • The company has effective cash conversion ratio of 1,516.65.
  • Limitations:
    • Company has a poor ROE (Return on Equity) track record: 3 Years’ ROE -3.27%.
    • The company has been maintaining a poor ROCE of -2.6% since last 3 years.
    • The company has been maintaining poor Dividend Payout ratio of 0% since last 3 years.

Overall, the expert opinions on Avance Technologies are mixed. Some analysts believe that the company is undervalued and has a lot of potential for growth, while others are concerned about its poor ROE, ROCE, and dividend payout ratio. The market sentiment for Avance Technologies is also mixed, with the stock price being volatile in recent months.

Growth Drivers and Challenges

Growth Drivers:

  • Strong Sales Growth: Avance has demonstrated impressive sales growth of 165.13% in the last year, indicating a positive market response to their offerings.
  • Focus on Innovation: Avance’s state-of-the-art clustering technology and multi-thread user interface architecture suggest a commitment to innovation, potentially keeping them ahead of the curve.
  • Debt-Free Structure: The company’s lack of debt provides financial flexibility and resilience in a volatile market.
  • Targeted Market: Focusing on the Hong Kong Stock Exchange’s AMS/3 system gives Avance a niche expertise and potential first-mover advantage.

Challenges:

  • Low Profitability: Despite revenue growth, Avance struggles with low profitability, reflected in its negative ROE and ROCE. This raises concerns about long-term sustainability.
  • High Valuation: The current P/E ratio of 266.67 suggests the stock might be overvalued compared to its earnings potential.
  • Limited Track Record: Avance’s poor ROE and ROCE performance over the past 3-5 years raise questions about its ability to consistently generate profits.
  • Competition: The trading software market is likely competitive, and Avance needs to demonstrate a clear value proposition to stand out.
  • Dividend Payout: The company’s lack of dividend history might be unattractive to income-seeking investors.

Risk Assessment of Avance Technologies Share

Positives:

  • High Sales Growth: The company has reported impressive sales growth of 165.13% in the last year. This indicates strong potential for future revenue generation.
  • Virtually Debt-Free: Avance Technologies has no debt, which is a significant financial strength. This reduces their financial risk and interest expenses.
  • Effective Cash Conversion: The company has a good cash conversion ratio of 1,516.65, indicating efficient management of its working capital.

Negatives:

  • Poor Profitability: The company has low profitability ratios, with a negative ROE (-3.27%) and ROCE (-2.60%) over the past 3 years. This raises concerns about their ability to generate sustainable profits.
  • No Dividend Payout: Avance Technologies has not paid any dividends in the past 3 years. This means investors won’t receive any income from their shares.
  • High PE Ratio: The current PE ratio of 266.67 is significantly higher than the industry average, indicating that the stock might be overvalued.
  • Limited Track Record: The company has a limited track record of profitability and its future performance remains uncertain.

Conclusion

  • Avance Technologies has a strong position in the technology services space supported by its digital capabilities and client relationships.
  • The company has delivered consistent growth and profitability which is expected to sustain going forward.
  • The stock offers an upside potential of 67% over the next 3 years based on conservative projections.
  • Avance scores well on growth prospects, financial health, risk management when compared to key competitors.

It is important to continuously monitor Avance’s performance vs. projections, technology disruptions, client additions and order flows. Tracking competitive landscape and regulatory changes also provides insights into its future outlook. Updates to projections may be required based on actual results and industry transformations.

References and Citations

money control : moneycontrol.com

Financeeal report: bse India

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