Indian contract manufacturer Aequs raises $54m

Catamaran, Steadview Capital, Sparta Group, and Amicus Capital also participated. It follows a INR 2.25bn round led by Amicus in April.

Amansa is an India-focused fund manager set up by Akash Prakash, a former director of India investments at Temasek Holdings. Catamaran and Sparta are the investment offices of Infosys co-founder Narayana Murthy and venture capitalist Desh Deshpande, respectively. Steadview is a UK-based, India-focused investor.

Aequs provides precision manufacturing of aerospace, toys, and consumable durable goods via factories in India, France, and the US employing around 4,000 staff. The company, founded in 2006, claims to be the largest aerospace precision components maker in India.

Operations include a so-called “forgings-to-assembly integrated manufacturing ecosystem” in an aerospace special economic zone in the southwestern state of Karnataka. The customer base is global; 100% of revenue is generated from exports. This includes most global aerospace companies, among them, Airbus, Boeing, Bombardier, Safran, Collins, Spirit, Eaton, and Honeywell.

Aequs will use the fresh capital to launch a new business line focused on advanced technology products with a view to serving major consumer electronics companies. In 2020, the company committed INR 35bn to setting up a consumer electronics and durable goods cluster in Karnataka. Construction began early last year.

“Aequs has always believed in the Indian manufacturing story and for the past 15 years focused on maximizing in-country value add on the products it makes across the industry verticals it operates in,” Aequs CEO Aravind Melligeri said in a statement.

“We are excited to partner with investors who have a deep understanding of the Indian capital markets, which I believe will bring immense value to Aequs. These partnerships will also help in tapping emerging opportunities due to the realignment of global supply chains and their relocation to India in many instances.”

Catamaran, which has historically focused on digital inclusion, has flagged manufacturing as an expansion area and a key growth driver in India. This is expected to be driven by a shift in industrial capacity away from China and domestic demand tied to rising affluence.

M.D. Ranganath, chairman of Catamaran recently observed that manufacturing currently represents 15% of India’s GDP, but there is scope for that figure to reach 25% in the medium term. This would put Indian manufacturing on par with the industries in Japan and Germany as India becomes the world’s third-largest economy.

“India exported about USD 2bn in mobile phones about two years ago. That number is already touching about USD 8bn this year. Part of it is because India has become such a large mobile phone market, it requires localisation. But it’s also about government policy supporting a competence ecosystem,” Ranganath told AVCJ in August.

“We saw that happen a few decades ago in two-wheelers when Japanese manufacturers developed the components ecosystem here. This time it will also be driven by geopolitics and government policy.”

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• South Asia
• Industrials
• Technology
• Expansion
• India
• Catamaran
• Steadview Capital
• manufacturing