July 07, 2026: Apollo Micro Systems Ltd. has announced one of its biggest capital-raising initiatives to date, with its Board approving a ₹3,322.23 crore preferential issue comprising equity shares and convertible warrants. The decision was taken during the Board meeting held on July 6, 2026, subject to shareholder and regulatory approvals.

 

Author: Aadarsh Patel | EQMint

 

The fundraising initiative is aimed at strengthening the company’s balance sheet, supporting future expansion plans and enhancing its financial flexibility.

 

Key Highlights

 

• • Total Fundraising Size: ₹3,322.23 crore

• • Equity Shares: Up to 2.28 crore shares

• • Convertible Warrants: Up to 5.69 crore warrants

• • Issue Price: ₹416.60 per share/warrant

• • Mode: Preferential issue through private placement

• • Extraordinary General Meeting (EGM): August 4, 2026

• • Record Date for E-voting: July 28, 2026

₹951 Crore Equity Issue Approved

The Board approved the issuance of up to 2,28,30,902 equity shares at ₹416.60 per share, raising approximately ₹951.13 crore.

 

The equity shares will be allotted to 55 non-promoter investors, including several institutional investors such as Tata Mutual Fund, Saint Capital Fund, Nautilus Private Capital Ltd., Maestro Emerging Fund PCC and Robust Knights Fund PCC.

 

₹2,371 Crore Convertible Warrants

In addition to the equity issue, Apollo Micro Systems also approved the issuance of up to 5,69,15,380 convertible warrants worth nearly ₹2,371.09 crore.

 

The warrants will be issued at the same price of ₹416.60 each and can be converted into equity shares within 12 months from the date of allotment. Investors will pay 25% upfront, with the remaining amount payable at the time of conversion.

 

The warrant issue includes allocations to both promoter and non-promoter investors. Promoters Chanakya Reddy Baddam and Kanishka Reddy Baddam together are proposed to receive 2.61 crore warrants, while the remaining warrants are allocated to institutional investors and other strategic participants.

 

Other Major Board Decisions

Apart from the fundraising exercise, the Board also approved:

 

• • Increase in authorised share capital from ₹45 crore to ₹63 crore

• • Appointment of Acuité Ratings & Research Ltd. as the monitoring agency

• • Seeking shareholder approval for higher borrowing limits

• • Approval to create security under the Companies Act

• • Approval for loans, guarantees and investments under Section 186

• • Convening an Extraordinary General Meeting (EGM) on August 4, 2026 through video conferencing.

Why This Matters

Apollo Micro Systems operates in the defence and aerospace electronics segment, supplying mission-critical electronic systems for defence, homeland security and space applications.

 

The proposed capital raise is among the largest undertaken by the company and signals an aggressive growth strategy. With India’s defence manufacturing ecosystem expanding under the government’s ‘Make in India’ and defence indigenisation initiatives, access to additional capital could help Apollo Micro Systems scale manufacturing capacity, invest in research and development, and execute larger defence contracts.

 

EQMint Analysis

The fundraising plan reflects Apollo Micro Systems’ confidence in its long-term growth prospects. Bringing in reputed institutional investors such as Tata Mutual Fund alongside several domestic and overseas funds strengthens investor confidence in the company.

 

However, investors should also consider the potential dilution resulting from the preferential allotment and future conversion of warrants into equity. The company’s ability to effectively deploy the capital into value-accretive projects will be crucial for sustaining shareholder returns.

 

Overall, the preferential issue appears to be a strategic move aimed at positioning Apollo Micro Systems for the next phase of growth in India’s rapidly expanding defence and aerospace sector.

 

Frequently Asked Questions (FAQs)

What is the total size of Apollo Micro Systems’ preferential issue?

The company plans to raise approximately ₹3,322.23 crore through equity shares and convertible warrants.

 

How many equity shares will be issued?

Up to 2.28 crore equity shares will be issued through the preferential allotment.

 

What is the issue price?

The issue price has been fixed at ₹416.60 per equity share and convertible warrant.

 

When is the EGM scheduled?

The Extraordinary General Meeting is scheduled for August 4, 2026.

 

Who are some of the key investors?

The proposed investors include Tata Mutual Fund, Saint Capital Fund, Nautilus Private Capital Ltd., Maestro Emerging Fund PCC and several other institutional investors.

 

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Disclaimer:  This article is not an investment advice and is for educational purpose only.