10:121 Rights Issue & Rs 17.70 Crore Order Bagged From Bharat Electronics: Multibagger Defence Stock with 6,478 Per Cent Returns

The stock is up by 25 per cent from its 52-week low, giving multibagger returns of 400 per cent in 3 years and a whopping 6,478 per cent in 10 years.

The Board of Directors of Avantel Limited has approved the terms of its upcoming Rights Issue. The company plans to issue up to 2,02,26,100 fully paid-up equity shares with a face value of Rs 2 each. The issue price has been set at Rs 40 per Rights Equity Share, which includes a premium of Rs 38. This Rights Issue aims to raise Rs 8090.44 lakh with the full amount payable upon application. The record date for determining eligible shareholders for the rights entitlement is May 7, 2025.

The Rights Issue will open on Thursday, May 15, 2025, and will close on Thursday, May 22, 2025. The last date for market renunciations is Tuesday, May 20, 2025. Eligible shareholders will be entitled to 10 Rights Equity Shares for every 121 existing Equity Shares held as of the record date, with the option to renounce their rights. Post the Rights Issue, assuming full subscription, the total outstanding equity shares of Avantel Limited will increase from 24,47,35,820 to 26,49,61,920 Equity Shares of Rs 2 each. The ISIN for the Rights Entitlement will be announced separately.

Additionally, the company has secured a new domestic manufacturing order worth Rs 17.70 crore (including taxes) from Bharat Electronics Limited, as communicated via mail on April 29, 2025. The terms of the order include a 3 per cent performance bank guarantee and the contract is slated for execution by September 20, 2028. This development aligns with SEBI's circulars regarding the disclosure of such significant orders.

About the Company

Established in 1990 by Vidyasagar Abburi, Avantel Limited is a prominent Indian technology company specialising in advanced communication and technology solutions for strategic sectors like defence and aerospace. Headquartered in Visakhapatnam with a corporate office in Hyderabad, Avantel is known for its high-quality and reliable products and services, including advanced communication systems, radar technology, and network management software. Holding AS 9100D and ISO 9001:2015 certifications, the company focuses on delivering innovative solutions in areas such as SATCOM, radar subsystems, SDRs and defence electronics, contributing significantly to India's technological self-reliance and national security.

According to Quarterly Results, the net sales increased by 18 per cent to Rs 49.26 crore and net profit decreased by 50 per cent to Rs 6.09 crore in Q4FY25 compared to Q4FY24. In its annual results, the net sales increased by 11 per cent to Rs 249.13 crore and net profit increased by 7 per cent to Rs 56.45 crore in FY25 compared to FY24.

The company is a Small-Cap company having a market cap of over Rs 2,800 crore with a 5-year stock price CAGR of 120 per cent. The company's shares have an ROE of 29 per cent and an ROCE of 37 per cent. The stock is up by 25 per cent from its 52-week low, giving multibagger returns of 400 per cent in 3 years and a whopping 6,478 per cent in 10 years. Investors should keep an eye on this small-cap defence stock.

Disclaimer: The article is for informational purposes only and not investment advice.