Aarti Industries Ltd
Aarti Industries Ltd (AARTIIND)

Aarti Industries Ltd (AARTIIND)

₹785.51.64%

Key Stats

₹770
Day's Price Range
₹791.5
₹725.1
52-Week Price Range
₹1168
1 Month Return-17.73 %
3 Month Return-20.74 %
1 Year Return-11.59 %

Company Financials

  • Quarterly
  • Annual
Value in ₹ crore

Peer Comparsion

PE
Rank 2
22.31
EPS
Rank 7
₹34.62
BVPS
Rank 9
₹100.5
Dividend Yield
Rank 8
0.23%
ROE
Rank 7
16.27%
Price To Book Ratio
Rank 3
7.68
Debt To Asset
Rank 1
0.54

Company Information

Aarti Industries Limited is a leading Indian manufacturer of Speciality Chemicals and Pharmaceuticals with a global footprint. It operates primarily in three segments namely speciality chemicals pharmaceuticals and home and personal care. Speciality Chemicals is the major revenuegenerating segment contributing approximately 78 of the companys sales. The other segments i.e. pharmaceuticals and home personal care contribute approximately 15 and approximately 7 of sales respectively. In speciality chemicals segment Aarti Industries is the largest producer of benzene derivatives in India and one of the leading manufacturers globally. It has integrated itself across the benzene chain and manufactures a variety of products from benzene. The company globally ranks between 1st and 4th position for 75 of its speciality chemical portfolio and is considered as Partner of Choice for various major global and domestic customers. It has a wide portfolio of over 200 products serving more than 700 domestic customers. The company is a strong exporter having relationships with over 300 export customers spread across the globe in 60 countries with major presence in US Europe China and Japan. The company serves leading consumers across the globe of Speciality Chemicals and Intermediate for Agro Chemicals Aromatics Dyes Fuel Additives Pharmaceuticals Pigments Polymer Additives Printing Inks Surfactants and various other speciality chemicals.The company operates three stateoftheart RD centres one for Speciality Chemicals and the other for Pharmaceutical APIs.Aarti Industries Ltd was incorporated on September 28 1984 as Aarti Organics Ltd. The company was promoted by Chandrakant V Gogri and Associates. In the year 1986 the company commenced commercial operations at Sarigam. In the year 1990 the company expanded the capacity of PNCB/ONCB organics division from 1200 TPA to 4500 TPA. During the year 199495 they further expanded their organics division in four phases. Also the name of the company changed to Aarti Industries Ltd.During the year 199899 the company enhanced the installed capacity of PNCB/ONCB from 15000 TPA to 22000 TPA. During the year 19992000 they further increased their capacity to 30000 TPA. In the year 2001 the company commissioned manufacturing operations at their new unit at Bharuch. They set up two RD Centres one at Turbhe and the other at Vapi Gujarat. During the year 200102 Alchemie Organics Ltd was amalgamated with the company with effect from April 1 2002. During the year 200203 the company set up a plant for production of Single Super Phosphate at Vapi and commenced commercial production. Also Sarigam and Vapi units were awarded ISO 9002 Certification during the year.During the year 200304 the company expanded their Vapi unit and started producing Sulphuric Acid. Also they completed and commissioned the captive power plant with the capacity of 6 MW. During the year 200506 the company increased the production capacity of Nitro Chloro Benzenes by 10000 MT to 60000 MT. Also they increased the production capacity of Sulphuric Acid Allied products by 50000 MT to 200000 MT.During the year 200607 the company started the Toll manufacturing of few products with applications in the specialty segments. During the year 200809 Surfactant Specialities Ltd and Avinash Drugs Ltd were amalgamated with the company with effect from April 1 2008.During the year 200910 the company commissioned and commercialized the indigenously developed facilities for manufacturing Nitro Toluenes and its various Derivatives developed at its Inhouse RD centre. They also got approval from US Food Drug Administration for their units at Tarapur and Vapi for new range of API products. Aarti Industries commissioned expanded capacity for a Pigment intermediate in Q1 FY 201314. In the pharmaceuticals business segment Aarti Industries scaled up its capacities from 4 lines to 9 lines for manufacturing of APIs at its Tarapur USFDA unit during the financial year ended 31 March 2014.During Q3 Financial Year 201415 Aarti Industries commissioned the first phase of its NCB expansion thereby enhancing the capacities upto 66000 MT. As a result the production of NCB had increased in Q4 Financial Year 201415 to 14800 MT as compared to the quarterly average of 13500 MT for Financial Year 201314. Production during Financial Year 201415 was about 53400 MT as compared to 54230 MT for Financial Year 201314. The production during first nine months was lower on account of shut down taken during the year for the ongoing brownfield expansion activities.Alchemie Leasing and Financing Private Limited and Gogri and Sons Investments Private Limited Transferor Companies were merged with Aarti Industries Transferee Company with effect from 1 April 2015. Pursuant to the Scheme of Amalgamation 16726401 Equity Shares were issued to the Shareholders of the Transferor Companies and 21997705 Equity Shares being held by Transferor Companies in the Company were cancelled.During the financial year ended 31 March 2016 Aarti USA Inc. and former associate Ganesh Polychem Limited became subsidiary of Aarti Industries and other companies namely Anushakti Chemicals and Drugs Limited Anushakti Holdings Limited Aarti Intermediates Private Limited Aarti BioTech Limited and Perfect Enviro Control System Limited ceased to be Associate Companies.Aarti Industries expanded its Nitro Chloro Benzene NCB capacity from 57000 TPA to 75000 TPA in November 2015. This incremental capacity will increase NCB market share in the domestic and global markets providing adequate feedstock for downstream products viz. Hydrogenated Products and other products with a higher EBIDTA. During the year under review the company expanded its PDA capacity from 250 TPM to 450 TPM and projected 1000 TPM by Q3 FY1617. This enhanced capacity will increase the companys presence in highend polymers and additives making it the only Indian source for MNCs that does not presently source this product from India.During Q1 FY1617 Aarti Industries commercialized the calcium chloride facility at Jhagadia. The Calcium Chloride Granulation unit has a capacity of about 30000 tpa at Jhagadia. Besides this unit the company already operates a similar unit at its unit at Kutch. These units convert the byproduct HCL into high quality Calcium Chloride Granules which is exported in global markets and finds its application into Oil Extraction and Deicing activities.In September 2016 Aarti Industries commenced commercial production of its 2nd Phase of PDA expansion from 450 tpm to 1000 tpm. Earlier in FY2015 16 the Company scaledup capacity from 250 tpm to 450 tpm. This expanded capacity will strengthen the companys presence in the high growth industries of engineering polymers and additives making it the only Indian source for MNCs who do not presently source this product from India.In September 2016 the company also commenced commercial production at Ethylation Unit in the Dahej SEZ. The Greenfield Ethylation unit has adopted Swiss Technology and has the capacity to manufacture about 8000 10000 tpa of Ethylene derivatives. Aarti is the first company in India to procure ethylene through a pipeline and operate an environment friendly ethylation process. The initial product manufactured at this unit has applications into Herbicides Agrochemicals and the company plans to add other products in due course with applications majorly into Agrochemicals catering to global Agrochemical majors. This Ethylation unit is first of its kind to be set up in India. The company expects the Ethylation Unit to reach near full utilisation within a span of 34 years. This unit would also enjoy the benefits as applicable to other SEZ units.On 16 December 2016 Aarti Industries completed Buyback of 1200000 fully paid up Equity Shares representing up to about 1.44 of the total number of Equity shares of the Company from all the Equity Shareholders/ Beneficial owners of the Company who held Equity Shares as on the record date i.e. 2 November 2016 on a proportionate basis through the tender offer using stock exchange mechanism at a price of Rs 800 per equity share for an aggregate amount of Rs 96 crore.During Q4FY17 Aarti Industries successfully closed USFDA facility inspection at Tarapur unit initiated in Q3FY17 and received the EIR copy. In April 2017 Aarti Industries Board approved an investment of Rs 75 crore to set up a world class RD scaleup and innovation complex equipped with the stateoftheart equipment and analytical tools. The new complex would comprise an RD centre a scaleup facility consisting of a kilolab and a pilot plant an innovation center dedicated labs for process safety effluent treatment etc. It will house over 150 scientists and engineers responsible for researching and developing breakthrough innovations as well as for commercial scale up of various Speciality Chemicals. The complex will more than double the companys RD capabilities and will enable the company to further strengthen its global presence in the enduser applications of Agrochemicals Fuel Additives Pharmaceuticals Polymers Rubber Chemicals etc.On 25 May 2017 Aart Industries incorporated a wholly owned subsidiary company in the name of Aarti Poiychem Private Limited with an initial authorized share capital of Rs 100000. In June 2017 Aarti Industries signed Rs 4000 crore multiyear deal with a global agriculture company for supply of an agrochemical intermediary. The contract entails supply of a high value agrochemical intermediary for use in herbicides over a 10 year period. The supplies are expected to commence from FY20 and would generate expected revenues of approximately Rs 4000 crore approximately USD 620 million over the contract term. The project will entail investment of about Rs 400 crore approximately USD 62 million by Aarti Industries. The enduse is amongst the major growth initiative of the customer and approximately US 1 billion is being invested for this project/initiative. The contract win highlights the companys global partner of choice positioning amongst the leading global agrochemicals polymer pigment and other speciality chemicals companies.On 15 March 2018 Aarti Industries completed Buyback of 820383 fully paid up Equity Shares representing up to about 1 of the total number of Equity shares of the Company from the Equity Shareholders/ Beneficial owners of the Company who held Equity Shares as on the record date i.e. 5 January 2018 on a proportionate basis through the tender offer using stock exchange mechanism at a price of Rs 1200 per equity share. The companys capex plan is on track with an investment of about Rs 613 crore in FY 201718 including an investment of Rs 55 crore for acquisition of land for expansion projects and proposed new RD centre. Further in respect of the Nitro toluene facility commissioned at Jhagadia during Q2 FY 201718 had achieved a capacity utilisation of over 40 during Q4 FY 201718. During FY 201718 Aarti Industries entered into two longterm multiyear supply contracts. First one being a 10year contract with a global agricultural company to supply a high value agrochemical intermediary for use in herbicides. The supplies are expected to commence from 2nd half of FY 201920 and would generate expected revenues of approximately Rs 4000 crore over the contract term. The project will entail investment of about Rs 400 crore. The second one being the case where Aarti Industries had entered into a 20year contract with a global chemical conglomerate to supply a high value speciality chemical intermediate. The supplies are expected to commence from calendar year 2020 and would generate expected revenues of approximately Rs 10000 crore over the contract term. With this deal the company is set to enter a new chemistry range firstofitskind in India. The company will be investing US 3540 million to setup a dedicated largescale manufacturing facility for production of this intermediate and will be built on basic technology package received from the customer. As a part of the contract terms the customer shall provide US 42 million as an advance to the company which shall be then adjusted against the supplies in future. This shall help the company reduce the net capital employed enabling significant higher ROCE returns for the project.Both these units are being set up in Dahej SEZ at Gujarat. The company has already acquired the land for the said purposes and is expected to start the constructions works soon. The company expects to be able to commission the said units within the expected timelines. Since these upcoming facilities will be a 100 exportoriented the company would also benefit from the tax benefits as applicable to the SEZ units.The Board of Directors Aarti Industries at its meeting held on 28 June 2018 approved the Scheme of Arrangement pertaining to demerger of Home Personal Care Segment of the company into Arti Surfactants Limited and demerger of manufacturing under taking of Nascent Chemical Industries Limited into company. Aarti Industries incorporated a wholly owned subsidiary Arti Surfactants Limited on 18 June 2018 for proposed demerger and absorption of Home Personal Care undertaking. This demerger shall help being more focussed on this business to improve the performance.Nascent Chemicals Industries Ltd Nascent is an entity Incorporated in the year 1966 and having the business of manufacturing operations in Gujarat as well as Trading of Chemicals. Aarti Industries Limited through its 100 subsidiary Aarti Corporate Services Ltd holds 50.49 stake in Nascent. The manufacturing division of Nascent manufactures few speciality chemicals on behalf of Aarti Industries Limited under the conducting arrangement. These products are part of the integrated value chain of Speciality Chemicals of Aarti Industries Limited.During the FY2019 pursuant to the approval of the members of the Company the Fund Raising Committee of the Board in its meeting held on March 23 2019 approved and allotted of 5368647 Equity Shares of Rs 5 at a premium of Rs 1392 through Qualified Institutional Placement.As on 31March 2019the Company has 6 Six direct subsidiaries namely Aarti Corporate Services Limited Alchemie Europe Limited Innovative Envirocare Jhagadia Limited Ganesh Polychem Limited Aarti USA Inc. Aarti Polychem Private Limited and 2 Two indirect subsidiaries namely Shanti Intermediates Private Limited Nascent Chemical Industries Limited both hold through Aarti Corporate Services Limited.During the year 201819 the Company has proposed a Scheme of Arrangement for demerger of its Home Personal Care undertaking into the Aarti Surfactants Limited and merger of manufacturing undertaking of its step down subsidiary Nascent Chemical Industries Limited into Aarti Industries Limited. The said Scheme was approved by the Honorable National Company Law Tribunal NCLT Ahmedabad Bench vide its order dated 10th June 2019 and this become effective from the appointed date of 1st April 2018.The company has been investing into various capex programmes/projects being undertaken by the company catering to long term growth opportunities at various companys sites. The company expect some of the major projects such as expansion of chlorobenzenes capabilities from 110000 tpa to 175000 tpa projects at Dahej for first long term contracts and the setting up of the 4th RD centre to commissioned in FY 201920 while other ongoing projects such as speciality chemical intermediates block expansion cum debottlenecking for Pharma units and the facility catering to the third long term contract is expected to be commissioned in FY 202021. During the year 201819 the company also initiated the project for expanding its NCB capacities from 75000 tpa to 108000 tpa with an outlay of about Rs 150 crore. It is expected to commission this expanded capacity in FY 202021. With these current pipeline of projects the company expect to invest about Rs 1000 to Rs 1200 crore in FY 201920 and about Rs 500 to Rs 600 crore in FY 202021.During the FY2020 pursuant to the approval of NCLT Ahmedabad vide its order dated June 10 2019 on the Composite scheme of Arrangement between the Company Aarti Surfactants Limited and Nascent Chemical Industries Limited the Board in its meeting held on July 08 2019 approved the allotment of 448590 Equity Shares of Rs 5 each to the shareholders of Nascent Chemical Industries Limited as on July 05 2019. Additionally the Board in its meeting held on August 13 2019 approved and recommended the issue of Bonus shares. The shareholders approved the issue of Bonus Shares at the Annual General Meeting of Company held on September 16 2019. The Company allotted 87117237 fully paid up Equity Shares of face value Rs 5/ each in the proportion of 1:1 i.e. One Bonus Equity shares of nominal value Rs 5/ each for every 1One Equity shares of nominal value of Rs 5/ each. The Bonus shares were credited to the eligible shareholders as on the record date i.e. September 30 2019.The Company as on March 31 2020 has 10 Ten direct subsidiaries namely Aarti Corporate Services Limited Innovative Envirocare Jhagadia Limited Ganesh Polychem Limited Aarti Polychem Private Limited Aarti Organics Limited Aarti Bharuch Limited Aarti Spechem Limited Aarti Pharmachem Limited Aarti USA Inc. Alchemie Europe Limited and 2 Two indirect subsidiaries namely Shanti Intermediates Private Limited Nascent Chemical Industries Limited both hold through Aarti Corporate Services Limited. Of the above subsidiaries Aarti Organics Limited Incorporated on November 22 2019 Aarti Bharuch Limited Incorporated on November 22 2019 Aarti Pharmachem Limited Incorporated on November 26 2019 Aarti Spechem Limited Incorporated on November 27 2019 were incorporated as wholly owned subsidiary of the Company during the year. During the year 201920 Aarti Surfactants Limited ceased to be wholly owned subsidiary of the Company.During the FY2021a subsidiary viz Ganesh Polychem Limited ceased to be a subsidiary and became a jointly controlled entity w.e.f. March 17 2021.
OrganisationAarti Industries Ltd
HeadquartersVAPI
IndustryChemicals