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Aarti
Industries consolidated net sales declined 12.17% to Rs 1414 crore in Q1FY24
compared to Q1FY23. Revenues declined on
account of decline in volumes, decline in prices of key RM and margin
contraction due to excess supply from China, etc.
Operating
profit margin has declined from 17.64% to 14.22%, leading to 29.23% decline in
operating profit to Rs 201.00 crore. Raw
material cost as a % of total sales (net of stock adjustments) increased from
54.10% to 56.18%. Purchase of finished
goods cost rose from 3.76% to 5.71%.
Employee cost increased from 5.61% to 6.86%. Other expenses fell from 19.00% to
17.60%.
PBIDT
fell 29.23% to Rs 201 crore. Provision
for interest fell 11.11% to Rs 40 crore.
PBDT
fell 32.64% to Rs 161 crore. Provision
for depreciation rose 23.61% to Rs 89 crore.
Profit
before tax down 56.89% to Rs 72.00 crore.
Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 2 crore,
compared to Rs 31 crore. Effective tax
rate was 2.78% compared to 18.56%.
Minority
interest was nil in both the periods.
Net profit attributable to owners of the company decreased 48.53% to Rs
70.00 crore.
Promoters’
stake was 43.65% as of 30 June 2023 compared to 44.19% as of 30 June 2022.
Commenting on the
performance for Q1 FY24, Mr. Rajendra Gogri – Chairman & MD at Aarti
Industries Limited said:
“We
entered the new financial year on a cautious note with unprecedented challenges
faced by the chemical industry mainly owing to sluggish demand. This was
aggravated by oversupply situation in China due to weak domestic demand,
inventory correction across the globeand slowdown in several developed markets.
All this has significantly impacted the volumes as well as product
realisations. We believe this istransient in nature and the long-term prospects
continue to be appealing. Our performance mirrored the industry trends which
remainedsubdued overall. We continue to utilise our efforts to optimise the
business operations and offer best possible value to our customers which isa
testament of our commitment and continued progress.
Our
medium-to-long term growth journey remains on track and in-line with this, our
CAPEX initiatives are progressing satisfactorily. We aimto complement our
product offerings by leveraging the deep expertise in manufacturing as well as
R&D competence. We have maintainedour leadership position in Benzene-based
derivatives and the objective is to replicate the same success for several
other specialisedchemical value-chains. Our Zone 4 project initiatives is
taking concrete shape and we remain confident of commencing production in
aphased manner from FY25. With short term macro headwinds significantly
prevailing in CY23, we expect the year to be weaker thanexpected earlier. However,
the long-term opportunities remain strong and intact and thus we remain
optimistic and expect FY25 to be acrucial year for us, steering the growth
momentum.
The
road ahead continues to be inspiring, guided by immense potential that India
can offer on a global scale. While the short-term scenariowill test our
capabilities, the long-term prospects remain compelling. We are well poised to
demonstrate a standpoint performance once thetrend reverses, anchored by our
inherent strengths and nuanced understanding of market complexities. We will
continue to remain agile tothe evolving market conditions and grow responsibly
thereby enhancing value for the stakeholders.”
Full year results
analysis
Net
sales of Aarti Industries has increased 8.77% to Rs 6619 crore. Operating profit margin has declined from
28.27% to 16.45%, leading to 36.69% decline in operating profit to Rs 1,089.00
crore. Raw material cost as a % of total
sales (net of stock adjustments) increased from 44.38% to 52.83%. Purchase of finished goods cost rose from
4.30% to 4.79%. Employee cost increased
from 5.67% to 5.88%. Other expenses rose
from 18.33% to 19.88%.
PBIDT
fell 36.72% to Rs 1089 crore. Provision
for interest rose 64.17% to Rs 168 crore.
Loan funds rose to Rs 2,907.00 crore as of 31 March 2023 from Rs
2,203.96 crore as of 31 March 2022.
Inventories rose to Rs 1,031.00 crore as of 31 March 2023 from Rs 934.13
crore as of 31 March 2022. Sundry
debtors were lower at Rs 940.00 crore as of 31 March 2023 compared to Rs
1,091.52 crore as of 31 March 2022. Cash
and bank balance rose to Rs 200.00 crore as of 31 March 2023 from Rs 173.56
crore as of 31 March 2022. Investments
declined from Rs 28.29 crore as of 31 March 2022 to Rs 17.00 crore as of 31
March 2023.
PBDT
fell 43.10% to Rs 921 crore. Provision
for depreciation rose 25.81% to Rs 310 crore.
Fixed assets increased to Rs 5,848.00 crore as of 31 March 2023 from Rs
4,940.64 crore as of 31 March 2022.
Profit
before tax down 55.47% to Rs 611.00 crore.
Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 66 crore,
compared to Rs 186.25 crore. Effective
tax rate was 10.80% compared to 13.57%.
Minority
interest was nil in both the periods.
Net profit attributable to owners of the company decreased 54.03% to Rs
545.00 crore.
Equity
capital decreased from Rs 181.25 crore as of 31 March 2022 to Rs 181.00 crore
as of 31 March 2023 . Per share face
Value remained same at Rs 5.00.
Promoters’
stake was 44.07% as of 31 March 2023 ,compared to 44.19% as of 31 March 2022
.
Cash
flow from operating activities increased to Rs 1,310.00 crore for year ended
March 2023 from Rs 519.00 crore for year ended March 2022. Cash flow used in acquiring fixed assets
during the year ended March 2023 stood at Rs 1,326.00 crore, compared to Rs
1,165.00 crore during the year ended March 2022.
The
scrip trades at Rs 472
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Aarti Industries : Consolidated
Results
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Particulars
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2306 (03)
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2206 (03)
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Var.(%)
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2303 (12)
|
2203 (12)
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Var.(%)
|
|
Net Sales
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1,414
|
1,610
|
-12
|
6,619
|
6,086
|
9
|
|
OPM (%)
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14.2
|
17.6
|
|
16.5
|
28.3
|
|
|
OP
|
201
|
284
|
-29
|
1,089
|
1,720
|
-37
|
|
Other Inc.
|
0
|
0
|
-
|
0
|
1
|
-
|
|
PBIDT
|
201
|
284
|
-29
|
1,089
|
1,721
|
-37
|
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Interest
|
40
|
45
|
-11
|
168
|
102
|
64
|
|
PBDT
|
161
|
239
|
-33
|
921
|
1,619
|
-43
|
|
Depreciation
|
89
|
72
|
24
|
310
|
246
|
26
|
|
PBT
|
72
|
167
|
-57
|
611
|
1,372
|
-55
|
|
Share of Profit/(Loss) from Associates
|
0
|
0
|
-
|
0
|
0
|
-
|
|
PBT before EO
|
72
|
167
|
-57
|
611
|
1,372
|
-55
|
|
EO Income
|
0
|
0
|
-
|
0
|
0
|
-
|
|
PBT after EO
|
72
|
167
|
-57
|
611
|
1,372
|
-55
|
|
Taxation
|
2
|
31
|
-94
|
66
|
186
|
-65
|
|
PAT
|
70
|
136
|
-49
|
545
|
1,186
|
-54
|
|
Minority Interest (MI)
|
0
|
0
|
-
|
0
|
0
|
-
|
|
Net profit
|
70
|
136
|
-49
|
545
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1,186
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-54
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EPS (Rs)*
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#
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#
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15.0
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32.7
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Notes
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* EPS is on current equity of Rs 181.25 crore, Face value of Rs
5, Excluding extraordinary items.
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# EPS is not annualised
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bps : Basis points
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EO : Extraordinary items
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Figures in Rs crore
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Source: Capitaline Corporate Database
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