Aequs Ltd Q4 FY26: Building Plane Parts, Bleeding Cash on Plastic Toys

Section 1 — At a Glance

The financial narrative of Aequs Ltd in FY26 is a study in extreme contrasts. The company sits on a commanding ₹12,300 Cr market capitalization, fresh off a ₹922 Cr IPO in December 2025, boasting a robust USD 889 million order book in its core aerospace segment. Yet, the bottom line is bleeding out, with a consolidated net loss of ₹113.25 Cr for the fiscal year.

The tension lies in capital allocation and operational drag. Aerospace revenue jumped 27% YoY, displaying pricing power and high entry barriers. But management has aggressively expanded into the consumer electronics and toys segment, where severe underutilization (~23%) and a heavy depreciation load have shattered consolidated profitability. Expanding aggressively into low-margin contract manufacturing while your core high-margin business thrives is a strategic gamble that markets rarely price accurately in the short term.

Aequs is undertaking massive capital expenditure, signing MoUs worth ₹4,756 Cr across Karnataka and Tamil Nadu, while simultaneously absorbing operating cash outflows of ₹98.75 Cr this year. This sets up a precarious near-term reality. If the consumer segment fails to reach its promised EBITDA breakeven by Q4 FY27, the aerospace cash engine will be forced to subsidize plastic toys indefinitely.

Section 2 — Introduction

Aequs started in 2000 and has built something genuinely difficult: a vertically integrated aerospace ecosystem within a single Special Economic Zone (SEZ) in Belagavi, Karnataka. They handle everything from forging and machining to surface treatment and assembly.

Recently, however, the company decided that producing critical landing gear components for Airbus and Boeing wasn’t enough excitement. They branched out into contract manufacturing for consumer electronics and toys, setting up massive facilities in Hubballi and Koppal. They now run three integrated clusters in India, complemented by aerospace plants in Cholet, France, and Paris, Texas. It is a sprawling, ambitious footprint for a company still trying to prove it can turn a consistent net profit.

Section 3 — Business Model: WTF Do They Even Do?

If you look at the Aequs product portfolio, you might assume you are reading the catalogs of two entirely different companies that accidentally shared a printer.

On one side, they manufacture over 5,000 highly critical aerospace products. We are talking about titanium main landing gears, wing flap supports, actuator pistons, and radarboxes for global OEMs like Safran, Collins Aerospace, and Spirit AeroSystems. It is high-precision engineering with punishing qualification cycles.

On the other side, they make pawls, pan-seats, base brackets, and plastic toys for Hasbro and Spinmaster. Yes, the company that helps keep planes in the sky is currently being financially dragged down by plastic kitchenware and action figures. The blended capacity utilization sits at a grim 44%—with aerospace running a respectable 65-70%, while the consumer segment is shivering in the dark at around 17-20%.

Section 4 — Financials Overview

Figures are consolidated, in ₹ crore.

The topline growth is exactly what you want to see—up 47% YoY. The bottom line is what happens when operating leverage shifts into reverse. Q4 FY26 delivered a staggering ₹53.72 Cr loss.

Management faced the music in the concall, with the CFO attributing the margin compression entirely to the consumer ramp-up. They are taking the “full run rate of depreciation on consumer capex alongside