Comments
SMC Research
Aarti Ind (Buy)
CMP: ₹273.05
Target: ₹320
The company plans to expand its critical and base production process viz chlorination process by about 15,000 tpa, i.e., from present 65,000 tpa to 80,000 tpa. This expansion shall ensure adequate supply of first stage products over next 3-4 years for captive consumption for forward chain of products as well as to meet the additional demand for these chemicals from global markets. Moreover, the company also proposes to set up a calcium chloride granulation plant. This shall consume the by-product HCL generated in the process and convert that into commercially marketable product with high export potential. The company already has one such unit in Bhachau, Kutch, and another one is now being planned at Vapi, Gujarat.
The company expects its pharma EBIT margin to grow to around 20 per cent in the next few quarters led by export growth. The company is awaiting approval for 4-5 US-based products in next 4-5 quarters. The company expects to do 2 drugs master files (DMFs) filings in every quarter. The company will be benefiting from falling crude oil prices as it will also reduce the price of benzene, derive from crude oil, which is the key raw material of the company in producing products like agrochemicals and polymers.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.