Aequs Limited has approved a proposed $67.8 million (₹650 crore) equity infusion through convertible warrants subscribed by its Promoter Group, providing capital for expansion across the company’s aerospace and consumer manufacturing businesses.
The board approved a preferential issue of up to 28,071,690 warrants, each convertible into one fully paid equity share with a face value of approximately $0.10 (₹10), to Mellwood Trustee Services Private Limited, trustee of the Melligeri Private Family Foundation.
The transaction remains subject to shareholder and applicable statutory and regulatory approvals.
The Promoter will pay approximately $33.9 million (₹325 crore) upfront upon allotment of the warrants, representing 50% of the approximately $67.8 million (₹650 crore) issue size and twice the regulatory minimum.
The remaining consideration will be payable when the warrants are exercised.
Under applicable regulations, the warrants can be exercised within 18 months of allotment, although Aequs said conversion into equity shares and payment of the remaining consideration will occur on or before December 31, 2027.
The Promoter has committed to paying the remaining amount in full regardless of Aequs’ market share price when the warrants are exercised.
The warrants will be issued at approximately $2.41 (₹231.55) each, representing the floor price determined under applicable Securities and Exchange Board of India regulations.
The price is based on the higher of the 90-trading-day and 10-trading-day volume-weighted average price of Aequs shares preceding the September 22, 2026 relevant date.
Following full conversion of the warrants, the combined ownership of Aequs’ Promoter and Promoter Group will increase from 59.09% to 60.73%.
Aequs plans to use the proceeds to increase manufacturing capacity as it pursues new business opportunities across aerospace and consumer products.
The investments will include development of the company’s Hosur facility, along with investments in subsidiaries and joint ventures supporting its expansion.
A portion of the proceeds will also be available for general corporate purposes.
The equity infusion will additionally establish a larger capital base against which Aequs can raise term borrowings to finance its expansion plans.
The board has assessed the company’s equity requirements through fiscal 2028 and intends to meet those requirements through the warrant issuance.
Aequs said it may consider a broader capital raise later if required by its growth plans.
The financing comes as Aequs reports winning new aerospace programs faster than originally anticipated, requiring the company to invest in capacity before related revenue and cash flows are generated.
Aequs operates a vertically integrated manufacturing ecosystem with capabilities spanning forging, precision machining, surface treatment, and assembly.
Within aerospace, the company has a portfolio of 5,740 qualified parts covering engine systems, structures, actuation systems, landing systems, and assemblies.
It serves global aerospace manufacturers and system suppliers including Airbus, Boeing, Safran, and Collins Aerospace.
Aequs also operates consumer manufacturing businesses spanning electronics, plastics, toys, and consumer durables.
Its manufacturing clusters are located in Belagavi, Hubballi, and Koppal in Karnataka, with international operations in the United States and France.
The company reported annual machining and molding capacity of approximately 4.78 million hours based on annualized first-quarter fiscal 2027 figures.
Aequs has scheduled an Extraordinary General Meeting for October 22, 2026 to seek shareholder approval for the warrant issuance.
KEY QUOTES:
“We are winning programmes faster than we had planned for, and those wins need investment ahead of the revenue they bring. This issue gives Aequs committed capital to build that capacity and the equity base to support the borrowing that goes with it. The Promoter Group is subscribing at the price as per SEBI pricing formula and paying half of it upfront — that is the measure of our confidence in what this business can deliver.”
Aravind Melligeri, Executive Chairman And CEO Of Aequs
