Apollo Micro Systems approves ₹951 crore preferential equity issue, plans larger ₹3,322 crore capital raise

In addition to the equity issue, the company has also approved the issuance of up to 5,69,15,380 convertible warrants at the same issue price of ₹416.60 per warrant, raising another ₹2,371.09 crore. The warrants will be allotted to promoter group entities and identified non-promoter investors through a preferential allotment route. Collectively, the equity shares and warrants will enable the company to raise more than ₹3,322 crore.

Under the terms of the warrant issue, investors will be required to pay 25% of the total issue amount upfront, while each warrant will be convertible into one fully paid-up equity share of face value Re 1 within 12 months from the date of allotment. The entire consideration for the preferential equity shares will be payable at the time of application.

As part of the fundraising exercise, Apollo Micro Systems has also approved an increase in its authorised share capital from ₹45 crore to ₹63 crore by creating an additional 18 crore equity shares of Re 1 each.

The company has scheduled an Extraordinary General Meeting (EGM) on August 4, to be conducted through video conferencing, where shareholders will seek approval for the proposed fundraise and related resolutions. The record date for determining shareholders eligible to vote electronically has been fixed as July 28.

Among the notable investors proposed to participate in the preferential equity issue are Saint Capital Fund, which is slated to receive 50 lakh shares, while Nautilus Private Capital Ltd, Maestro Emerging Fund PCC-Value Investing, Robust Knights Fund PCC-Cell 1, M7 Global Fund PCC Cell Dewcap Fund, and Cullinan Opportunities Incorporated VCC Sub Fund 1 are each proposed to receive 25 lakh shares. Tata Mutual Fund is expected to receive 12 lakh shares.

For the warrant issue, Opal Global Diversified Fund Limited has been identified as the largest proposed allottee with 1.20 crore warrants. Promoters Chanakya Reddy Baddam and Kanishka Reddy Baddam are proposed to receive 1.305 crore warrants each, while Cullinan Opportunities Incorporated VCC Sub Fund 1 is expected to receive 45 lakh warrants.

The board also approved the appointment of Acuité Ratings & Research Ltd. as the monitoring agency for the utilisation of issue proceeds, besides clearing proposals related to enhanced borrowing limits, creation of security, and loans, guarantees and investments, subject to shareholder approval.

Apollo Micro Systems has been one of the standout performers in the defence space over the past year. The stock has delivered around 130% returns in the last 12 months, while gaining approximately 115% over the past three months. It touched a 52-week high of ₹466.70 earlier this month, compared with a 52-week low of ₹162.25 recorded in July 2025.

Disclaimer: This article is for informational purposes only and does not constitute financial advice.