Aarti Industries Q4 preview: PAT likely to fall 35% YoY, margins may see 2.3% drop

Aarti Industries, the chemical manufacturing company, is likely to report a weak result for the quarter ending March 31, 2023, due to a fall in benzene prices which will lead to a decline in the speciality chemical segment’s margin by 14 per cent year-on-year (YoY). Other factors that could affect the quarterly numbers negatively include, a lack of demand in discretionary sectors like dyes pigments and textiles and higher interest rates which could increase the interest expense, according to a research report by Zee Business.

The company is likely to report a 35.1 per cent fall in consolidated profit after tax (PAT) to Rs 126 crore year-on-year (YoY) for Q4FY2023, according to Zee Business Research.

Chemical makers’ revenue is expected to fall by 5.64 per cent to Rs 1,657 crore compared with the year-ago period. The company is likely to report earnings before interest, taxes, depreciation, and amortisation (EBITDA) at Rs 284 crore against Rs 340 crore logged in the previous quarter. On a YoY basis, EBITDA may decline by 16.47 per cent.

The company's margin — a key measure of profitability for a business — is likely to decline by 230 basis points to 17.1 per cent. Business earnings could grow on the back of better renewable and coal businesses. Incremental income is expected from new projects from FY24 onwards.

On Friday, May 5, 2023, shares of Aarti Industries traded flat on BSE at Rs 551.95 apiece, and on NSE, the stock traded 0.17 per cent lower at Rs 551.3. Aarti Industries' shares have declined over 25 per cent in value in the past six months, a period in which headline indices Nifty50 declined 0.32 per cent each.

About Aarti Industries

Aarti Industries Limited (AIL) is an Indian manufacturer of speciality chemicals and pharmaceuticals with a global footprint. The company manufactures chemicals used in the downstream manufacturing of pharmaceuticals, agrochemicals, polymers, additives, surfactants, pigments, and dyes.

Catch the latest stock market updates here. For more news on sports, politics follow Zee Business