Aequs Limited has signed a non-binding Memorandum of Understanding with the Government of Tamil Nadu on February 16, 2026, marking a significant step in the company's expansion plans. The agreement involves Guidance, the nodal agency of the Government of Tamil Nadu, and focuses on establishing a new manufacturing facility in the state.

Investment and Manufacturing Scope

The MoU outlines an ambitious investment plan for aerospace component manufacturing in Tamil Nadu. Key details of the proposed investment include:

Government Support and Incentives

The Government of Tamil Nadu has committed to providing comprehensive support for the manufacturing unit establishment. The state government will offer:

• Infrastructure Support: Necessary infrastructural facilities and regulatory facilitation subject to applicable laws
• Power Supply: Uninterrupted power supply on best-effort basis
• Policy Incentives: Standard incentives as per existing Tamil Nadu Government policies
• Facilitation Services: Administrative and regulatory support through the Guidance agency

Strategic Significance

This domestic agreement represents Aequs Limited's strategic expansion into Tamil Nadu's manufacturing ecosystem. The company specializes in aerospace components, and this MoU will enable manufacturing of critical aircraft components including engines, landing gear, and various aircraft systems within the state.

The agreement is structured as a non-binding MoU, providing flexibility for both parties while establishing the framework for future collaboration. The ten-year investment timeline demonstrates the company's long-term commitment to developing manufacturing capabilities in Tamil Nadu.

Regulatory Compliance

Aequs Limited has disclosed this development in compliance with Regulation 30 of the Securities and Exchange Board of India Listing Obligations and Disclosure Requirements Regulations, 2015. The company confirmed that this arrangement does not constitute a related party transaction, ensuring transparency in corporate governance practices.

Aequs Limited has announced a further investment in its wholly owned subsidiary Aequus Engineered Plastics Private Limited (AEPL) through a rights issue, as disclosed under Regulation 30 of SEBI Listing Regulations. The investment involves subscribing to 96,32,117 shares at ₹10 per equity share, representing a total investment of ₹9,63,21,170.

Investment Details and Structure

The rights issue subscription maintains Aequs Limited's complete ownership of AEPL, with no change in the percentage of shareholding. The subsidiary will continue to remain wholly owned by the parent company.

Subsidiary Financial Performance

Aequus Engineered Plastics Private Limited, incorporated on February 10, 2015, is engaged in manufacturing plastic products, parts and toys. The subsidiary's recent financial performance shows declining revenue trends over the past three years.

As of March 31, 2025, AEPL reported a loss after tax of ₹28.48 crore and a negative networth of ₹4.36 crore, indicating financial challenges that this investment aims to address.

Purpose and Utilization of Funds

The investment forms part of the utilization of IPO proceeds as specified in Aequs Limited's prospectus dated December 5, 2025. The funds will be specifically utilized for:

• Repaying existing bank loans of the subsidiary
• Meeting working capital requirements of AEPL

Regulatory Compliance

Since AEPL is a wholly owned subsidiary, this transaction is classified as a related party transaction. However, pursuant to Regulation 23(5) of SEBI Listing Regulations, transactions between a holding company and its wholly owned subsidiary do not fall within the ambit of related party transaction requirements. No governmental or regulatory approvals are required for this investment.

The promoter, promoter group, and group companies of Aequs Limited have no interest in AEPL except for the shares held by the company itself. The investment represents Aequs Limited's continued support for its subsidiary's operations and financial stability in the plastic manufacturing sector.