Karnataka-based precision and product manufacturing company Aequs Ltd on Friday said its board has approved a preferential issue of up to 2,80,71,690 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.
Of the total issue size, ₹325 crore will be payable upfront upon allotment of the warrants, representing 50% of the issue size and twice the regulatory minimum. The balance amount will be payable upon exercise of the warrants. The issue is subject to shareholders’ approval and other applicable statutory and regulatory approvals.
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 Regulations, 2018. The warrants may be exercised within 18 months from the date of allotment. However, conversion into equity shares by payment of the balance consideration will take place on or before December 31, 2027.
The promoter has undertaken to pay the balance consideration in full, irrespective of Aequs’ share price at the time of exercise. The company has received an investment commitment letter dated September 25, 2026, from the promoter to this effect. Aequs said the proceeds will fund capacity expansion across its aerospace and consumer businesses, including development of the Hosur facility, investments in subsidiaries and joint ventures supporting the expansion, and general corporate purposes.
The equity infusion will also provide the base against which Aequs raises term borrowings for the expansion. The board has assessed the company’s equity requirement through FY28 and decided to meet it through the issue. The investment also aligns the promoter group’s economic commitment with Aequs’ long-term growth plans and capital requirements.
Aravind Melligeri, Executive Chairman and CEO, Aequs Limited, said, "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 the SEBI pricing formula and paying half of it upfront — that is the measure of our confidence in what this business can deliver."ALSO READ | Aequs CEO unfazed by near-term aviation volatility, sees strong demand supporting growthShares of Aequs Ltd ended at ₹246.00, up by ₹3.15, or 1.30%, on the BSE.