Company Update - Restructuring - Aarti Industries - ICICI Direct

Aarti industries' board has approved the restructuring of the pharma business and allied activities of the company, which will be demerged into Aarti Pharmalabs Ltd (formerly known as Aarti Organics Ltd), a wholly owned subsidiary company of Aarti Industries Ltd. The demerged undertaking also includes a part of the specialty chemical business, which is a backward integrated facility providing feeding material to the pharma business. This part of the specialty chemical business accounts for less than 3% of revenues of the speciality chemical business. The demerged company would continue to run and operate the remaining specialty chemical business.

Financial profile of pharma business

The pharma business recorded a revenue CAGR of 19.6% over FY17-21 to Rs. 872 crore while EBIT grew at 43.8% CAGR to Rs. 205 crore for the same period. The focus of the management towards increasing speciality value portfolio share has aided margins historically. Going forward, once additional capacity for APIs and intermediates comes on stream by H2FY22E, one can expect strong momentum for the segmental growth. We expect revenues to grow in high teens over the next period.

For details, click on the link below: Link to the Report

Shares of Aarti Industries Ltd was last trading in BSE at Rs. 921.8 as compared to the previous close of Rs. 910.5. The total number of shares traded during the day was 31106 in over 2014 trades.

The stock hit an intraday high of Rs. 925 and intraday low of 905.1. The net turnover during the day was Rs. 28521742.

Source : Equity Bulls

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