Target: ₹145
CMP: ₹123.30
Aequs (Latin for equal) was incorporated in 2000 by promoter Mr Aravind Melligeri, an engineering technocrat who is the key driving force behind the company. Aequs has in over a decade transitioned into a tier I supplier for many aerospace majors (Airbus, Boeing, Safran). Its wins in key component programmes of majors has increased parts supplied by it to nearly 5,200+. Given that Airbus aims to increase sourcing from India to $2.1 billion (FY30) versus $1.4 billion (FY25) we see significant scope for growth. Aequs, with its unique end-to-end manufacturing/forging capabilities and its status as a D2P (Detailed to Parts) supplier for Airbus, stands to gain a higher programme share.
Aequs is a combination of a well-established aerospace segment and the optionality of a potentially rapidly expanding consumer segment (off a low base). We value it at FY30E EBITDA as that is when we expect key benefits of the intensive-capex phase to start showing up, and discount back to FY28 to derive our TP of ₹145.
Given the current listing, the risk reward is favourable and we initiate at Buy. In our valuation framework, 75 per cent of the value accrues from the established aerospace business underpinned by decades-old customer connections, while 25 per cent of the EV is from consumer, which is at a smaller, suboptimal scale currently (FY26) but has significant scale-up potential.