CRISIL said that the rating upgrade follows equity infusion of Rs 757 crore by way of initial public offering, the proceeds used to reduce outstanding debt, for capex and for working capital purposes, strengthening the financial risk profile.

The rating upgrade also reflects improvement in business risk profile backed by above average revenue growth and sustained profitability supported by higher utlisation and realizations. Business risk profile is expected to improve over medium term, with company working on capacities with new products with higher realisations.

The ratings on the bank loan facilities of AIL continue to reflect an established market position in the specialty chemicals business, strong relationship with reputed global and domestic customers, presence across diverse end-user segments and a comfortable financial risk profile.

These strengths are partially offset by sizeable working capital requirements and susceptibility to project implementation and stabilization risks.

CRISIL Ratings believes AIL will continue to benefit from the strong technical and business acumen of promoters, company's established market position, reputed clientele, and healthy profitability.

Aether Industries is a leading manufacturer of advanced intermediates and active ingredients for the pharmaceutical, material science, agrochemical, electronic chemical, and fine / speciality chemical industries.

The company reported 5.3% fall in net profit to Rs 30.62 crore on 6.7% increase in revenue from operations to Rs 160.01 crore in Q1 FY23 over Q1 FY22.

The scrip shed 0.51% to currently trade at Rs 969.80 on the BSE.