Shares of this chemical company jumped 7 percent in Thursday’s trading session after securing a 4-year supply contract worth over Rs. 6,000 crores with a multinational conglomerate company. The shares have delivered more than 30 percent returns to its shareholders in six months.
With a market capitalisation of Rs. 22,345 crores, the shares of Aarti Industries Ltd started Thursday’s trading session on a higher note at Rs. 601 compared to its previous close of Rs. 583.05. During the trading session, the shares hit a high of Rs. 633.50, gaining around 7 percent and are currently trading at Rs. 614 apiece.
Such a bullish movement in the share price was observed after the company in an exchange filing announced that they had signed a long-term agreement with a multinational conglomerate for the supply of a niche speciality chemical. The contract entails supply over four years and is anticipated to generate revenue of over Rs. 6,000 crores for the company.
According to the contract, Aarti Industries will supply the niche speciality chemical for four years. Furthermore, the company mentioned that they have established robust relationships with this customer and have supplied the said product for the past five years.
This is the second contract it signed in the last month. Earlier, on December 27, the company had signed a long-term, contract with Global Agrochem for nine years with a revenue potential worth over Rs. 3,000 crores. long-term contracts between 2017 and 2019 and these contracts had material expectations in revenue terms.
Coming onto the company’s financial statement, the revenue increased marginally by 3 percent from Rs. 1,414 crores in the June quarter to Rs. 1,454 crores during the September quarter. In addition, the net profits zoomed by 30 percent from Rs. 70 crores to Rs. 91 crores during the same timeframe.
Aarti Industries has planned to deploy Rs. 2,500 to 3,000 crore for growth initiatives over a two-year period and the company is also targeting the commissioning of the ethylation and nitrotoluene projects in Q1 FY25.
Headquartered in Mumbai, Aarti Industries was incorporated in 1984. The company manufactures speciality chemicals in benzene-based derivatives. Key value chains include Nitro Chloro Benzenes (NCBs), Di-Chloro Benzenes (DCBs), Phenylenediamines (PDAs), Nitro Toluene Value Chain and Equivalent Sulphuric Acid (E.S.A) and downstream.
Written By Vaibhav Patil
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