Aarti Industries Ltd. share price target

We recommend to BUY Aarti Industries for a target of INR 630- valuing the company on SOTP basis. Geared for growth with global leadership in Speciality Chemicals: AIL has a strong understanding of chlorine derivative chemistry and has the largest nitro-chlorobenzene capacity in India at 60,000 tonnes per annum. Exports account for 51% of speciality chemicals division. It offers over 100+ products to MNCs globally(globally ranks 1st -5th for most of its key products) having...

Aarti Industries Limited - AARTIIND is one of the largest producers of Benzene-based basic and intermediate chemicals in India and manufactures 125 products with chemistry of benzene, aniline, sulphuric acid, toluene and methanol. AIL is one of the leading global suppliers of dyes, pigments, agrochemicals, pharmaceuticals and rubber chemicals. The company has three reportable segments - Speciality Chemicals, Pharmaceuticals and Home & Personal Care Chemicals. Aarti has 16 manufacturing units spread across Gujarat & Maharashtra and a strong Research & Development with sophisticated instruments & pool of scientists. Aarti has customers spread across the globe in 60 countries with major presence in USA, Europe, Japan & India. Ashika Stock Broking advise their investors to BUY the stock with target price of Rs. 620, valuing at P/E multiple of 13.8x FY18E EPS.

Trendlyne has 4 reports on AARTIIND updated in the last year from 3 brokers with an average target of Rs 650.

Speciality chemicals: Revenues +3.1% YoY with flat volumes on non-availability of nitric acid (on drought conditions). Nitro-Chloro Benzene vol. fell to 12,460T vs 16,400T in Q3FY16 as did hydrogenation volumes. But, growth in other high margin products saw EBIT rise by 15% YoY to INR1.2bn. FY16 Volume rose ~10% YoY with +15% FY17...

9 Pharma segment saw healthy 69% yoy jump in sales with 510bps expansion in EBIT marginto17.1%.Expects+20%growthinFY17ledbyrecentdebottlenecking. Key highlights: Reported inline operating performance with 3% sales growth and 210bps...

Leveraging its cost advantage and quality, Aarti has long been exporting competently to China. With a visible slowdown in Chinese exports (stricter environment policy) and rising manufacturingcostsinthatcountry(duetohighercompliancerequirements),Aartiiswell...