Is Aequs’ IPO a long-term bet or a wait-and-watch opportunity?

Synopsis Aequs, an aerospace components maker, is set to raise significant funds through an IPO. The company plans to use the capital for debt repayment, expansion, and acquisitions. Aequs operates globally with a strong focus on its aerospace division. Investors will be watching its financial performance post-listing. The company aims to strengthen its position in the aerospace sector. ET Intelligence Group: Aequs, an aerospace components maker, plans to raise ₹670 crore through a fresh issue to repay debt and to fund capital expenditure and acquisitions. It will also raise ₹2,518 crore through an offer for sale. The promoter group's stake will fall to 59.1% after the IPO from 64.5%. It operates units in three manufacturing clusters in India and has two manufacturing facilities in France and the United States. The company has reported losses for the last three years owing to the new segment of household appliances. Its aerospace business is heavily dependent on the performance of the global aviation sector. About 89% of its revenue comes from international markets with US and France contributing over 20% each. Its operating margin before depreciation and amortisation (Ebitda margin) was at 11.7% in FY25 compared with its 35-38% for peers. Given these factors, investors may wait to see clarity in financials after the listing. headwinds Three years of losses, a weaker appliances biz reflect in its metrics trailing peers even as aerospace showed some traction Business Incorporated in 2000, Aequs has two segments-aerospace and consumer products. The aerospace division contributes over 90% to revenue through the manufacture of components for engine systems, landing systems, cargo and interiors for aerospace clients. As of September 2025, it produced over 5,000 products in this segment including programs for single aisle (such as A220, A320, B737) and long range (A330, A350, B777, B787) commercial aircraft. Its capacity utilisation grew to 42% in FY25 from 39% in FY23. About 54% of the revenue comes from the top three and 89% comes from top 10 clients. Its consumer portfolio includes cookware, small home appliances, figurines, toy vehicles and components for consumer electronics. Live Events Financials The company's revenue grew by 6.7% annually to ₹924.6 crore between FY23 and FY25 while Ebitda rose by 30.9% to ₹108 crore. Ebitda margin improved to 11.7% in FY25 from 7.8% in FY23. Aequs has recorded a net loss of ₹102.3 crore in FY25 compared with a loss of ₹109.5 crore in FY23. On a segmental basis, aerospace revenue grew by 18.7% annually to ₹824.6 crore while that of the consumer segment dropped by 33.6% to ₹100 crore between FY23 and FY25. Cash conversion cycle days increased to 253 days in FY25 from 157 days in FY23. Valuation The company is yet to report profit, so price-to-earnings multiple will not work. Considering the post-IPO equity and revenue for FY25, the price-to-sales (P/S) multiple is nine compared with that of 21-89 for peers, which include Azad Engineering, Unimech Aerospace and Manufacturing and PTC Industries. (You can now subscribe to our ETMarkets WhatsApp channel) (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price ...moreless How a Sebi report reopened Indiabulls-YES Bank saga that was fading Ever wondered why cos' financials look good before IPO, but not after? From near collapse to INR50k cr value: The journey of MCX AI is forcing a rethink. Can Indian IT finally build a serious corporate VC muscle? Stock Radar: 20% rally in 1 month! BHEL breaks above falling trendline resistance to hot fresh 52-week high Weekly Top Picks: These stocks scored 10 on 10 on Stock Reports Plus 1 2 3