Aarti Industries Q2 Results Review - Long Term Prospects Remain Buoyant: Dolat Capital

Dolat Capital Report

Aarti Industries Ltd.'s Q2 FY23 grew by 34.2% YoY to Rs 16.9 billion (up 4.6% sequentially) driven mainly by higher demand for products catering to essential industries (pharma, agro and fast moving consumer goods).

We wish to highlight the quarterly numbers have been recasted to account for the pharma segment demerger.

Aarti Industries' Ebitda grew marginally by 4.8% YoY to Rs 2.7 billion registering an Ebitda margin decline of 445 basis points YoY to 15.8% (sequential decline of 164 bps) weighed down by higher raw material costs and increase in employee cost (up 27.0% YoY) and opex (up 30.7% YoY).

Adjusting for revaluation loss of Rs 208.3 million, profit for the period saw a marginal decline of 3.1% YoY to Rs 1.5 billion (up 7.2% sequentially).

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