Aarti Industries Ltd.
NSE: AARTIINDAarti Industries Ltd.: A 30-second snapshot
Aarti Industries is a Chemicals sector manufacturer trading at ₹466.25, with standalone Q4 FY26 revenue up 22.5% YoY and consolidated revenue up 13.2% YoY. Trailing PE stands at 40.4 on a profit margin of 5.06% and ROE of 7.25%, with debt-to-equity of 83.4 and a rising debt trend. The stock sits 10.9% below its 52-week high and has returned +0.17% over 12 months.
P/E
40.4
Forward P/E
22.9
ROE
+7.3%
Debt / Equity
83.39
Profit Margin
+5.1%
Div. Yield
+0.2%
5Y ROE > 15%
0/5
5Y FCF > 0
2/5
Quality
43/100
News
8 headlines · 5 positive · 1 negative
AARTIIND: Strong FY26 growth with resilient margins, robust CapEx, and proactive risk management - TradingView
TradingView
Aarti Ind Standalone March 2026 Net Sales at Rs 2,439.00 crore, up 22.5% Y-o-Y - Moneycontrol.com
Moneycontrol.com
Aarti Ind Consolidated March 2026 Net Sales at Rs 2,206.00 crore, up 13.19% Y-o-Y - Moneycontrol.com
Moneycontrol.com
AARTIIND: Revenue and profit rose in FY26, with robust margins and timely debt servicing - TradingView
TradingView
Additional Considerations Required While Assessing Aarti Industries' (NSE:AARTIIND) Strong Earnings - simplywall.st
simplywall.st
Recent context
- ·Standalone Q4 FY26 net sales of ₹2,439 crore (up 22.5% YoY) and consolidated net sales of ₹2,206 crore (up 13.2% YoY) were reported in early May 2026, with commentary noting robust capex and margin resilience in the specialty chemicals segment.
- ·A Simply Wall St. piece published 11 May 2026 flagged additional considerations while assessing the company's strong earnings, implying the headline profit figures may warrant closer examination of underlying earnings quality.
- ·News flow over the coverage window skews 5 positive to 1 negative out of 8 total items, with recurring themes of FY26 growth, margin management, and proactive risk handling — though the thin sample size limits the reliability of this distribution.
Strengths
- +Revenue growth of 22.5% standalone and 13.2% consolidated YoY in Q4 FY26, with 5-year revenue CAGR of 13.2% and earnings CAGR of 43.4%, indicating meaningful top-line compounding over the medium term.
- +Earnings growth 5y CAGR of 43.4% significantly exceeds the revenue growth rate, suggesting some operating leverage or cost discipline over the period even as margins remain thin at 5.06%.
- +Forward PE of 22.9 versus trailing PE of 40.4 implies the consensus earnings estimate for the next year is approximately 77% above trailing earnings — analysts (mean rating 2.09 across 21, on a 1–5 scale where lower = more constructive) appear to be pricing in a material earnings uplift.
- +Stock trades above both the 50-DMA (₹445.75) and 200-DMA (₹403.08) with RSI at 48.7 (neutral), suggesting no near-term technical breakdown signal in the current price structure.
Weaknesses
- −ROE of 7.25% has never exceeded 15% in the tracked history (roeYearsAbove15 = 0); the business has not generated high returns on equity, which is notable for a chemicals manufacturer with a significant capital base.
- −Debt-to-equity of 83.4 with a rising trend and FCF positive in only 2 of tracked years flags a capital structure that is being stretched by the ongoing expansion cycle — interest coverage and cash generation will be worth monitoring as capex continues.
- −Quality score of 27 ranks 5th of 6 in the Chemicals peer set; peers Pidilite (quality 66, ROE 23.5%) and Solar Industries (quality 61, ROE 31.3%) demonstrate that significantly higher return profiles are achievable in the same sector.
- −Trailing PE of 40.4 at a quality score of 27 represents the weakest quality-to-valuation positioning in the peer group: Coromandel trades at PE 28.2 with a higher quality score (30) and higher ROE (15.6%).
Open questions
- ?Does the 43.4% five-year earnings CAGR reflect a structural improvement in Aarti Industries' cost structure and product mix, or is it recovering from a cyclical low base in FY21-22 that makes the forward earnings step-up harder to sustain?
- ?With FCF positive in only 2 of tracked years and debt-to-equity rising to 83.4, how is the company funding its capex cycle — internal accruals, debt, or equity — and what is the debt service coverage at current operating margins?
- ?The forward PE of 22.9 versus trailing PE of 40.4 embeds a large earnings estimate; what are the key contract wins, capacity utilisations, or pricing assumptions underpinning analyst projections for the next 12 months?
- ?Peer Pidilite trades at a quality score of 66 vs Aarti's 27 — what structural differences in business model, customer concentration, or pricing power explain this gap, and has that gap been narrowing or widening over the past 3 years?
Peer comparison: Chemicals
Ranks 5 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| AARTIIND | Aarti Industries Ltd.You're viewing | 40.4 | +7.3% | 27 |
| Industry avg | across 5 peers | 51.8 | +21.1% | 45 |
| PIDILITIND | Pidilite Industries Ltd. | 61.2 | +23.5% | 66 |
| SOLARINDS | Solar Industries India Ltd. | 93.6 | +31.3% | 61 |
| SRF | SRF Ltd. | 43.5 | +13.8% | 41 |
| COROMANDEL | Coromandel International Ltd. | 28.2 | +15.6% | 30 |
| PIIND | PI Industries Ltd. | 32.6 | — | 25 |
Technical state
Current price
₹466.25
SMA 50
₹445.75
SMA 200
₹403.08
RSI (14)
48.7 (neutral)
From 52w high
-10.9%
1Y return
+0.2%
3M return
-0.2%
50-DMA
Above
200-DMA
Above
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- highDebt-to-equity of 83.4 (i.e. ~0.83x net debt to equity) with a rising debt trend across the persistence window; FCF positive in only 2 of the tracked years against a capital-intensive expansion cycle — sustained negative free cash flow alongside rising leverage raises solvency-management questions.
- mediumROE of 7.25% has never exceeded 15% across the tracked history (roeYearsAbove15 = 0); profit margin of 5.06% is thin for a specialty chemicals manufacturer. Consistency score of 3 out of 5 reflects irregular profitability.
- mediumTrailing PE of 40.4 represents a valuation premium relative to earnings quality: quality score of 27 ranks 5th of 6 in the Chemicals peer set, the lowest composite quality position among ranked peers. Coromandel trades at PE 28.2 with a quality score of 30 and ROE of 15.6%.
- low12-month price change of +0.17% and 3-month change of -0.19% indicate the stock has been effectively flat over both periods despite trading above the 50-DMA (₹445.75) and 200-DMA (₹403.08). The 52-week drawdown of -10.87% from the high persists.
- lowNews sample of 8 articles is at the lower bound of meaningful coverage; one neutral headline from Simply Wall St. flags additional earnings quality considerations, suggesting reported profits may include non-recurring or non-cash items.
Cross-section contradictions
- Forward PE of 22.9 implies a significant earnings step-up is anticipated, yet trailing ROE of 7.25% and 0 years above 15% in the historical record show no precedent for the kind of earnings surge that would justify this re-rating — forward estimates carry execution risk against a weak historical returns profile.
- Stock trades above both the 50-DMA and 200-DMA with 5 positive vs 1 negative news items, yet 12-month price return is near zero (+0.17%) — near-term momentum and news tone have not translated into price appreciation over the past year.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 25 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 17 May 2026 · rotates through NIFTY 500 every ~5 days