Aequs IPO: Should you apply?

Summary: Aequs, a leading manufacturer in the aerospace industry, is set to go public on December 3, 2025. We analyse the company’s strengths, weaknesses and past financials to help you better decide whether its IPO is worth subscribing to.

Aequs, a precision component manufacturer, will open its IPO (initial public offering) on December 3, 2025 and close on December 5, 2025. Of the total issue size of Rs 922 crore, Rs 670 crore comprises a fresh issue, while the remaining Rs 252 crore will be raised via an offer for sale (OFS).

Here, we breakdown the company’s business, financials, strengths, risks and valuation to help you make an informed investment decision.

What the company does

Aequs Limited is a vertically integrated precision components manufacturer operating from a single SEZ (special economic zone), giving it a unique position in India’s aerospace supply chain. It has one of the country’s largest aerospace product portfolios, supplying critical parts across engines, landing systems, structures and interiors. Its metallurgical strengths, including the ability to machine high-end alloys like titanium, further differentiate it from its peers.

While aerospace remains its core, Aequs has gradually expanded into consumer electronics, plastics and small appliances by leveraging its advanced manufacturing capabilities.

Track record and valuation

When it comes to financials, Aequs’s performance has been a mixed bag. Though its revenue grew by a modest 6.7 per cent, net income (profit after tax) remained negative for the three consecutive fiscals. EBIT (earnings before interest and tax), too, remained largely negative, except in FY24.

At the upper end of the price band (Rs 124), Aequs’s stock is expected to be valued at around 5.7 times its book value. The P/E cannot be calculated owing to negative earnings. In comparison, its peers trade at a P/E and P/B of 96.4 times and 11.7 times, respectively.

The good

Below are some of the key strengths of Aequs.

#1 Leading player in the aerospace manufacturing segment

Aequs is positioned as the leading end-to-end aerospace manufacturer operating within a single SEZ, backed by extensive approvals and a wide range of capabilities. Its five manufacturing ecosystems together offer nearly 2.9 million annual machining and moulding hours, supported by over 200 CNC machines for aerospace and 161 moulding machines for consumer products. These facilities enable large-scale production of complex parts such as engine and landing-system components. 

With advanced capabilities in multi-axis machining, forging, metal forming, surface treatments and moulding, Aequs can deliver start-to-finish manufacturing for highly technical aerospace parts as well as precision consumer electronics and plastics. This vertically integrated setup, built over 15 years, helps the company scale efficiently and expand into new segments using existing capabilities.

#2 Global presence

Aequs has built a global footprint across India, the US and France, giving it strategic proximity to major aerospace OEMs and access to diverse engineering talent. This presence strengthens long-term customer relationships and helps the company tailor solutions for global clients. Over the years, Aequs has expanded beyond organic growth through targeted acquisitions such as T&K Machine in the U.S. and the SIRA Group in France, adding machining, assembly, fabrication and testing capabilities. These acquisitions have deepened its reach in North America and Europe and positioned Aequs closer to customers such as Boeing, Spirit, Safran and Collins Aerospace.

#3 Long-standing clientele

Aequs has built long-standing relationships with high-entry-barrier global clients across aerospace and consumer segments, including Airbus, Boeing, Collins Aerospace, Safran, Spirit, Hasbro and Wonderchef. The company has grown into a Tier-1 supplier for several OEMs, reflecting the depth of these partnerships. As of September 30, 2025, its three largest customer groups had worked with Aequs for an average of 15 years.

The bad

Here are some of Aequs’s drawbacks.

#1 Revenue heavily depends on a single segment

Aequs remains heavily dependent on its aerospace business, which contributed 88.23 per cent of revenue in the first half of FY26 and between 72 and 89 per cent over FY23-25. This concentration means any slowdown in aerospace demand or unfavourable industry developments could materially impact the company’s growth, profitability and cash flows.

#2 Business relies significantly on a handful of clients

Aequs’s business is highly concentrated, with its 10 largest customer groups contributing 82-89 per cent of revenue between FY23 and the first half of FY26. This dependence makes the company vulnerable to any weakening in these customers’ financial health or to a reduction in demand across the aerospace or consumer segments in which it operates. Since most of these clients are large OEMs, any slowdown in specific product lines or broader industry cycles could directly affect Aequs’s revenue, profitability and cash flows. could strain profit margins and adversely affect the company’s revenue and cash flows.

#3 High capex requirements

The company’s operations are capital-intensive, requiring ongoing investment to upgrade machinery, expand capacity and build new production lines for customers. These expenditures are funded through internal accruals, equity and debt, making steady access to capital critical. Any delays or shortfalls in funding could slow equipment upgrades, stall diversification plans or hinder technology improvements. Such disruptions may weaken competitiveness and cause the company to miss market opportunities, ultimately affecting revenue growth and profitability.

Where will the IPO proceeds go?

Of the fresh issue size of Rs 670 crore, Aequs aims to allocate around Rs 433 crore towards repaying the company’s borrowings, while Rs 64 crore will be deployed for the purchase of machinery and equipment. The remaining funds will be utilised for inorganic growth and general corporate purposes.

So, should you subscribe to the Aequs IPO?

Even with its scale in aerospace manufacturing, Aequs faces clear risks: narrow customer concentration, dependence on a single segment and modest profitability. And for investors, wealth is rarely built by chasing every IPO that hits the market. It is built by owning high-quality businesses that compound steadily over long periods.

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Also read: The great Indian IPO lottery