Emkay Global Financial's research report on Aarti Industries
Aarti is poised for a structural uptick in its value chains, led by i) headwinds faced by European players operating in similar value chains on high feedstock/energy costs, ii) India becoming more competitive in nitration after multiple nitric acid capacities coming on stream, and iii) a diversified end-user market. A large part of the capex spent in the last five years has not contributed to Aarti’s EBITDA due to 1) cancellation of the first long-term contract, 2) spends on asset refurbishment/replacement, which are non-revenue generating, 3) availability issues in nitric acid hindering volume growth.
Outlook
Aarti’s EBITDA has not grown materially over FY19-23, but we expect FY24-26E revenue/EBITDA/PAT CAGR at ~21%/38%/57%. We initiate coverage with a BUY recommendation and TP of Rs750/share, valuing it at 30x its Dec-25E EPS.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
