What Aequs' $102 million IPO tells us about India's aerospace boom

Aequs aerospace industrial park in Belagavi

Precision engineering player Aequs has come out with a $102.4 million IPO that was fully subscribed within hours of launching on Wednesday. The company is majorly into aerospace component manufacturing and is a supplier to Boeing and Airbus.

India's aerospace boom is just unfolding with both the major players Boeing and Airbus looking forward to expand their supplies from the country that is serving as a credible alternative to China.

"Our expansion on the aerospace side to bring in other capabilities is among our key growth levers. What we are trying to do is expand into vertical integration," its chief executive Aravind Melligeri said.

For Aequs, around 89.19% of FY25 revenue came from aerospace while 10.81% came from consumer, a report from Angel One stated.

Aequs provides fully vertically integrated, precision manufacturing ecosystem for the aerospace and consumer sectors. The company has manufacturing operations across three continents – India, France, and the USA, to provide supply chain efficiencies to its global customer base. It operates three manufacturing clusters in Karnataka.

What works for the company is its SEZ-based integrated ecosystem that delivers a cost-efficient, export oriented and globally competitive precision engineering solutions.

Both Boeing and Airbus already source parts worth more than $1 billion from the country. Airbus CEO Guillaume Faury, who recently visited India, said it is the fastest growing civil aviation market in the world and there is also fierce competition among airlines. Both IndiGo and Air India have placed orders for over 1,000 aircraft with Airbus.

Prime Minister Modi's ambition to turn India into a manufacturing hub for global players is getting attention from global aviation industry as it struggles to cope with domestic challenges. Boeing was hit with a huge workers' strike last year leading to production disruption and a backlog of deliveries.

"Aerospace precision engineering is witnessing strong multi-year tailwinds, backed by a global aircraft backlog of 14,158 units and India’s A&D PEC market set to rise from ₹137.86 billion in 2024 to ₹362.08 billion by 2030 at a 17.46% CAGR, benefiting suppliers with vertically integrated, cost-efficient manufacturing ecosystems," the Angel One report mentioned.

Another major player in the precision engineering space that is a major aerospace supplier is Azad Engineering. The listed company is  a major supplier for Boeing and Airbus and recently struck a deal to make engine components for Pratt & Whitney Canada.

India is one of the fastest growing aviation market in the world and aerospace manufacturing is set to witness a boom in upcoming years with global aviation biggies looking to increase their supplies which currently stands at around 2%.