Aequs Limited IPO Opens Dec 3 with Rs 670 Cr Fresh Shares; Check Price Band & Allotment

Aequs IPO: Precision Manufacturing Giant Set for December 3 Public Debut

Aequs Limited, a leading diversified contract manufacturing firm renowned for its vertically integrated precision capabilities in the aerospace and consumer durables sectors, is set to launch its Initial Public Offering (IPO) on Tuesday, December 3. The public issue aims to raise significant capital for strategic growth and debt reduction, marking a key milestone for the Bengaluru-based company.

The IPO, which is a Book Built Issue, will be open for subscription from December 3 to December 5. The much-anticipated IPO timeline sets the bidding for Anchor Investors a day earlier, on December 2. While the final price band is yet to be announced, the total issue size is expected to be finalized soon, offering clarity to prospective investors.

IPO Structure and Fund Utilization: A Dual-Component Issue

The Aequs IPO is a dual-component offering, blending a fresh issue of new equity shares with an Offer for Sale (OFS) by existing shareholders and promoters.

• Fresh Issue: The component for new shares is targeted to raise ₹670 crore. A significant portion of these proceeds is strategically earmarked for crucial financial and operational purposes:

  • Repayment/Prepayment of Debt: A substantial part of the funds will be used for the repayment or prepayment of outstanding borrowings, including penalties, availed by the company and its wholly-owned subsidiaries, AeroStructures Manufacturing India Private Limited and Aequs Consumer Products Private Limited.

  • Capital Expenditure: Aequs plans to utilize a portion of the funds to purchase essential machinery and equipment, primarily for the company and its subsidiary, AeroStructures Manufacturing India, which is critical for capacity expansion and maintaining advanced manufacturing capabilities.

  • Inorganic Growth and General Corporate Purposes: The remaining capital will be used to fund future growth initiatives, including potential unidentified acquisitions, other strategic initiatives, and general corporate needs.

• Offer for Sale (OFS): The IPO also includes an OFS of over 20.3 million shares (specifically, 20,307,393 shares in some reports) by the company’s promoters and existing investors. The shares being offloaded in the OFS are held by Melligeri Private Family Foundation and Aequs Manufacturing Investments Private Limited (Promoter Selling Shareholders), alongside several key institutional and individual investors.

The IPO tentative schedule suggests that the basis of allotment will be finalized on December 8, with the initiation of refunds and credit of shares to demat accounts on December 9. The shares are anticipated to be listed on both the BSE and NSE on December 10.

Marquee Investors and Pre-IPO Funding Details

Aequs has successfully attracted capital from some of the biggest names in the investment world, a testament to the strength of its business model and growth prospects.

The Big Names Backing Aequs

The company is supported by a robust list of prominent investors who will also be participating in the OFS (Offer for Sale) portion of the IPO. Key institutional backers include:

• Amicus Capital (across its various funds like Amicus Capital Private Equity I LLP, Amicus Capital Partners India Fund I, and Amicus Capital Partners India Fund II).

• Amansa Capital (specifically Amansa Investments Ltd).

• Steadview Capital (Steadview Capital Mauritius Limited).

• Catamaran, the family office of Infosys co-founder N.R. Narayana Murthy.

• Sparta Group (Sparta Group LLC).

Collectively, these investors held a significant stake in the company’s pre-offer equity share capital, highlighting a strong institutional endorsement. Individual investors like Ravindra Mariwala and Raman Subramanian are also listed among the selling shareholders in the OFS.

Pre-IPO Round: A Strategic Move

Earlier in November, Aequs demonstrated strong market confidence by successfully raising approximately ₹144 crore in a pre-IPO funding round. This strategic placement involved key institutional players:

• SBI Funds Management (across two entities).

• DSP India Fund.

• Think India Opportunities Fund.

This pre-IPO funding, which allotted over 11.6 million equity shares at a price of ₹123.97 per share, allowed the company to raise a portion of its capital requirement privately, leading to a minor revision in the fresh issue size for the public offering from an initial ₹720 crore to the final ₹670 crore (based on the latest RHP).

Business Verticals: Precision Across Segments

Founded by Aravind Shivaputrappa Melligeri, who has a background as a co-founder of QuEST Global Engineering, Aequs operates a distinctive, vertically integrated model. The company commenced its operations in 2009 by manufacturing components in the Belagavi Manufacturing Cluster in India and has since expanded its footprint globally, including facilities in France and the USA. A key competitive advantage is that it is one of India’s few precision component manufacturers operating within a single Special Economic Zone (SEZ) for its aerospace segment, offering a “one-stop-shop” capability to global OEMs.

1. Aerospace Segment

The company’s core business remains in the aerospace segment, where it provides high-precision components for aero-structures and aero-engines. Its comprehensive product portfolio includes components for engine systems, landing systems, cargo and interiors, structures, and assemblies. Aequs boasts long-standing relationships with global aerospace majors, serving as a critical supplier for programs run by clients such as:

• Airbus

• Boeing

• Bombardier

• Safran

• Collins Aerospace

• Spirit AeroSystems Inc

• GKN Aerospace

• Honeywell

2. Consumer Segment

Leveraging its engineering and manufacturing precision, Aequs has successfully diversified into the consumer segment, with product categories including:

• Consumer Durables: This portfolio features household items such as cookware and small home appliances, serving clients like Wonderchef and Tramontina.

• Plastics: The company manufactures plastic products, including outdoor toys, figurines, and toy vehicles, with major clients such as Hasbro and Spinmaster.

• Consumer Electronics: Aequs also supplies precision components for modern electronic devices, such as parts for portable computers and smart devices.

IPO Reservation and Management

The initial public offering adheres to the standard SEBI reservation structure for book-built issues, ensuring allocation across different investor classes:

• Qualified Institutional Buyers (QIBs): 75% of the total IPO size is reserved for this category.

• Non-Institutional Investors (NIIs): 15% is set aside for high-net-worth individuals and corporate investors.

• Retail Investors: 10% of the issue is reserved for individual retail applicants.

The book running lead managers entrusted with managing the IPO are JM Financial Limited, IIFL Capital Services Limited, and Kotak Mahindra Capital Company Limited. A successful listing on December 10 would validate Aequs’s vertically integrated model and its dual-segment strategy in the precision manufacturing space.