HDFC Securities believes that Aarti Industries’ (AIL) capex and continued focus on R&D will enable it to remain competitive and expand its client base. The toluene segment in India is mainly untapped and is met through imports, specialty chemicals The brokerage said entering this segment will benefit the construction company in the long run.
Brokerage house HDFC Securities has maintained its buy recommendation on Aarti Industries shares above the revised target price. 1,380 per share (from 1,330). The specialty chemical stock has risen more than 65% in a one-year period.
Aarti Industries’ Q3FY22 Revenue/EBIT grew 40/10% year-on-year (YoY), on account of higher pass-through of cost to customers. Testing is underway in the newly expanded block at the Intermediate Facility, which is targeted to be commissioned for Q4FY22.
“Q3 EBITDA/APAT was 203/339% higher than our estimates, primarily due to” One-time termination fee of 6.1 billion in EBITDA, and lower-than-expected depreciation and finance costs,” the brokerage said.
Aarti Industries Limited (AIL) is a leading Indian manufacturer of specialty chemicals and pharmaceuticals with a global footprint. It manufactures chemicals used in the downstream manufacturing of pharmaceuticals, agrochemicals, polymers, additives, surfactants, pigments and dyes.
The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
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