Aarti Industries - Q4 FY21 first cut - YES Securities

Standalone Revenue: Aarti's standalone revenue stood at Rs 11.4bn (+12.1% YoY) and remained stable compared to QoQ revenue. The YoY revenue was primarily driven by growth within its specialty chemicals segment (+13.9%) driven by volume expansion and higher contribution from value added products, while in QoQ growth in specialty chemicals segment (+1.8%) was offset by decline in pharma segment (-3.6%) due to partial shutdown taken at pharma units.

EBITDA: EBITDA at Rs 2,486Mn, stood higher by 17.6% YoY and -7.7% QoQ, while margins stood at 21.7% (20.7% YoY; 23.6% QoQ). Margins during the quarter was impacted due to higher fixed cost on account of commissioning of new manufacturing units.

Profit/(Loss) After Tax: On after tax basis, Aarti Reported a Profit of Rs 1,339Mn (+25.1%YoY; -17.3%QoQ). The YoY growth in PAT was primarily attributable to significantly lower interest expenses, while QoQ profitability was impacted due to higher depreciation expense on commissioning of new manufacturing units.

Capex for FY21 stood at Rs 13.1bn compared to Rs 11.4bn in FY20 owing to expansion activities and diversification into new products.

Expansion activities: Started commercial operations at Chlorination unit at Jhagadia, enhancing chlorination capacity from 110KTPA to 175KTPA. Additionally, Started commercial operation for Phase 2 at Dahej SEZ unit for its pharma segment.

The company continued to receive shortfall fees of $5Mn (Rs 36-37Mn) in the quarter pertaining to cancellation of its first long-term contract.

Shareholder pay-out: The Company declared bonus shares in the ratio of 1:1 and recommended a final dividend of Rs 3.0 (60%) pre-bonus.

Shares of AARTI INDUSTRIES LTD. was last trading in BSE at Rs.1665.35 as compared to the previous close of Rs. 1746.35. The total number of shares traded during the day was 138464 in over 12084 trades.

The stock hit an intraday high of Rs. 1790 and intraday low of 1640.35. The net turnover during the day was Rs. 230773541.

Source : Equity Bulls

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