According to reports from Business Standard, Aequs Ltd's board has approved a preferential issue of up to 28.07 million warrants to Mellwood Trustee Services Private Limited, trustee of the Melligeri Private Family Foundation and a member of the promoter group, for approximately ₹650 crore. The promoter will pay ₹325 crore upfront, representing 50% of the issue size and twice the regulatory minimum, with the balance amount payable upon warrant exercise. The issue is subject to shareholders' approval and other applicable statutory and regulatory approvals, with the company seeking shareholders' nod at the Extraordinary General Meeting convened on October 22, 2026. Upon full conversion of the warrants, the aggregate holding of the promoter and promoter group in the company will increase from 59.09% to 60.73%. The warrants are priced at ₹231.55 each, which is the floor price determined under Regulation 164 of the Securities and Exchange Board of India (SEBI) (Issue of Capital and Disclosure Requirements) Regulations, 2018, and may be exercised within 18 months from the date of allotment, with conversion into equity shares by payment of the balance consideration taking place on or before December 31, 2027.
As reported by Business Standard, Aequs shares hit a new high of ₹286.05, surging 5% in Wednesday's intraday trading and marking the fourth consecutive day of gains. The stock has soared 18% during this four-day rally and zoomed 136% in the past six months from levels of ₹121 on March 30, 2026. At 12:03 PM on Wednesday, Aequs quoted 3.4% higher at ₹280.75, outperforming the 0.42% rise in the BSE Sensex. A combined 8 million shares changed hands on the NSE and BSE during the session. The company's market capitalisation stands at around ₹17,370.24 crore, with the stock surpassing its previous high of ₹274.60 touched on July 9, 2026.
As reported by Business Standard, the proceeds from the ₹650 crore warrant issue will fund capacity expansion across the aerospace and consumer businesses, including the development of the Hosur facility, investment in subsidiaries and joint ventures supporting that expansion, and general corporate purposes. The equity will also provide the base against which the company raises its term borrowings for the expansion. The board assessed the company's current equity requirement through FY28 and decided to meet it through this issue. The fresh capital will support the company's 2031 growth strategy, which envisions a total capex of $450 million to scale operations four to six times above 2026 levels. Executive Chairman and CEO Aravind Melligeri stated that the rapid fundraise, coming within a year of the company's initial public offering, provides management with clear visibility for investments over the next 18 months. The company plans to use fresh capital to support its growth strategy and expand its aerospace and consumer businesses by 2031, with another fundraise anticipated in FY28 to maintain growth momentum.
According to Business Standard, the company's managing director has reiterated robust growth guidance across its aerospace and consumer segments. For FY27, aerospace revenue growth is pegged at 25-30% with its earnings before interest, taxes, depreciation, and amortization (EBITDA) margin sustaining above 20% (versus 40% revenue growth and 23% EBITDA margin reported in Q1FY27). A strong $1 billion+ order book (up 13% quarter-on-quarter) in the Aerospace segment supports a 25-30% revenue compound annual growth rate (CAGR) potential for the next 5 years. Management expects regular additions to the order book, with analysts at Motilal Oswal Financial Services noting in a CEO Track report that the order book supports the company's growth trajectory. The consumer segment is expected to see exponential growth and a narrowing EBITDA loss, with management seeing the segment revenue growing 10-18x over the next 5 years driven by volume ramp-up, expecting EBITDA breakeven by Q4FY27 on ramp-up in capacity utilization to 40-50%, and a positive profit after tax in FY28/FY29.
According to Business Standard, the company plans to enter the drones and defence assemblies segments as part of its expansion strategy. For the current year, Aequs has committed ₹660 crore in capex, initially split 60% toward the consumer segment and 40% toward aerospace. Accelerating aerospace projects in the second half of the year may shift that balance further toward the aviation side. The newly raised equity will leverage the balance sheet by acting as a contribution toward term loans, with Aequs expecting to raise approximately ₹800 crore in debt by the end of this year, with deployment scheduled through the middle of next year. To meet the broader $150 million to $200 million equity requirement outlined in the 2031 plan, the company will likely explore qualified institutional placements (QIPs) around calendar year 2028. A qualified institutional placement was ruled out for the current round because the company is still within its first year post-listing and management prefers to focus on execution rather than roadshows.
