Aequs Jumps 12% To All-Time High On Nuvama’s Bullish Call

New Delhi, India Jul 8, 2026 ALN: Shares of contract manufacturer Aequs surged as much as 12% to hit an all-time high of ₹271 apiece on the Bombay Stock Exchange (BSE) after brokerage Nuvama Institutional Equities initiated coverage on the stock with a bullish outlook. This significant uptick reflects a growing investor confidence in Aequs, a company that has carved a niche for itself in the aerospace sector, particularly within India's rapidly expanding aerospace manufacturing landscape.

Following the initial surge, the stock later pared some of its gains amid profit booking, trading 6.12% higher at ₹257.60 apiece at 11:57 IST. At that time, the company’s market capitalisation stood at ₹17,276.35 crore (approximately $1.8 billion). The recent performance of Aequs shares is noteworthy, as they have gained around 12% over the past two trading sessions and have risen an impressive 87% year to date.

The latest rally in Aequs shares came after Nuvama initiated coverage on the aerospace contract manufacturer with a ‘Buy’ rating and a 12-month target price of ₹444, suggesting an upside of over 90% from the closing price on July 6. This bullish stance from Nuvama is significant, as it indicates a strong belief in Aequs' potential to outperform its peers in the aerospace sector.

Nuvama posited that Aequs deserves a valuation premium over pharmaceutical Contract Development and Manufacturing Organizations (CDMOs) due to the nature of aircraft programmes, which have significantly longer lifecycles compared to pharmaceutical molecules that may expire. This distinction is crucial as it highlights the stability and longevity associated with aerospace contracts, which can lead to more predictable revenue streams for Aequs.

Furthermore, Nuvama described Aequs as a “sector outperformer,” emphasizing its unique position as India's only vertically integrated aerospace Special Economic Zone (SEZ). The company supplies machined aerostructures, landing gear, and engine components to global Original Equipment Manufacturers (OEMs), including industry giants like Airbus, Boeing, Safran, Collins, and Bombardier. This diverse clientele not only underscores Aequs' manufacturing capabilities but also its strategic importance in the global aerospace supply chain.

Nuvama further highlighted that Aequs’ $889 million order book provides strong revenue visibility, projecting a remarkable 42% revenue compound annual growth rate (CAGR) and an 84% EBITDA CAGR between FY26 and FY29. Such projections underscore the company’s robust growth potential, driven by increasing demand in the aerospace sector as global air travel continues to recover from the pandemic-induced downturn.

However, the report also noted that Aequs’ consumer business has been a point of concern, remaining loss-making. The profitability of this segment is contingent upon achieving scale rather than merely improving margins. While the plastics business may take longer to mature, Nuvama expects the consumer electronics segment to grow at a pace faster than the company’s other segments, indicating potential for future profitability.

Despite the positive outlook, Nuvama cautioned that comparable global companies typically operate at EBITDA margins of 8% to 15%, which is below the management’s guidance of 20%. This discrepancy raises questions about Aequs' ability to meet its profitability targets, especially in a competitive global market.

In terms of risks, Nuvama identified several key factors that could impact Aequs’ performance. These include extended raw material lead times, which could disrupt production schedules, execution risks in the consumer segment, and the incomplete recovery in Boeing’s production, which could affect demand for Aequs’ aerospace components.

On the expansion front, Aequs is making significant investments to build an aerospace engine component ecosystem in India. Its Hosur facility is expected to be operational next year, with shipments likely to commence by 2028. This development aligns with the Indian government's push to bolster domestic manufacturing capabilities, particularly in the defense and aerospace sectors.

Earlier this year, the company signed Memorandums of Understanding (MoUs) worth ₹4,000 crore with the Tamil Nadu government to establish a 250-acre aerospace and defense cluster in Krishnagiri. This strategic move is expected to enhance Aequs’ operational capabilities and attract further investments into the region, contributing to the overall growth of the aerospace industry in India.

Additionally, Aequs partnered with NMB-Minebea India for an additional ₹1,980 crore investment in Tiruvallur, further solidifying its commitment to expanding its manufacturing footprint in the country. These initiatives not only position Aequs as a key player in the aerospace sector but also contribute to the broader economic development of the regions involved.

On the financial front, Aequs faced challenges in Q4 FY26, slipping into the red with a reported net loss of ₹53.7 crore compared to a profit of ₹8.9 crore in the same quarter the previous year. However, revenue rose 47% year-over-year and 13% quarter-over-quarter to ₹367.1 crore, driven by strong growth in both aerospace and consumer electronics segments. This revenue growth indicates that while the company is currently facing profitability challenges, its revenue-generating capabilities are improving, which could bode well for its future financial health.

In conclusion, Aequs is at a pivotal moment in its growth trajectory. With a strong order book, significant investments in expansion, and a positive industry outlook, the company is well-positioned to capitalize on the burgeoning aerospace market. However, it must navigate challenges related to profitability and operational risks to sustain its growth momentum and fulfill the bullish projections set forth by analysts like Nuvama. Investors will be closely watching Aequs’ upcoming financial results and strategic developments to gauge its ability to deliver on its ambitious growth targets.