Aarti Drugs
Stock Snapshot
Price Performance
Vista Outlook
Basis of our Recommendation
Aarti Drugs is strategically transitioning towards higher operational efficiency and value-driven growth, focusing on backward integration to mitigate raw material volatility and enhance margins. Management's emphasis on expanding its Metformin business and pursuing USFDA approvals is expected to unlock higher-margin opportunities, supporting Vista's forecast of stable revenue growth and margins. The company's recent capacity expansions, particularly at the Sayakha facility, are anticipated to bolster self-sufficiency and operational scale, aligning with Vista's outlook of consistent performance. However, challenges such as geopolitical instability and raw material cost fluctuations remain pertinent. The industry context, characterized by improving pricing power and a favorable regulatory environment for Indian CDMOs, further supports Aarti's growth trajectory. Over the next 12-24 months, key opportunities include scaling operations in regulated markets and leveraging a robust R&D pipeline, while watchpoints include potential supply chain disruptions and the need for continued regulatory compliance. Overall, Aarti Drugs is positioned for stable growth, albeit with caution warranted due to external pressures
Why We Like This Stock
- Strategic focus on backward integration is expected to improve margins and supply chain resilience
- Expansion into regulated markets and a strong R&D pipeline are likely to unlock higher-margin opportunities
- Capacity enhancements at the Sayakha facility are projected to drive operational efficiency and volume growth
Things To Watch Out For
- Geopolitical instability and raw material cost fluctuations pose risks to operational stability
- Dependence on regulatory approvals in key markets may delay growth initiatives
- Potential supply chain disruptions could impact production and pricing dynamics
Key Parameters
Financial Snapshot
View Technicals Analysis →| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 2,529 | 2,387 | 2,565 | 2,843 | 3,153 |
| Profit Before Tax (Cr.) | 236 | 212 | 211 | 250 | 278 |
| PBT Margin | 9.3% | 8.9% | 8.2% | 8.8% | 8.8% |
| Net Profit (Cr.) | 177 | 160 | 204 | 188 | 209 |
| Earnings Per Share | 19.3 | 17.5 | 22.4 | 20.6 | 22.9 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Axis Securities | ▲ Buy | 515 | 06-Aug-2026 |
Company Overview
Show Company Profile
Aarti Drugs Limited, through its subsidiaries, manufactures and markets active pharmaceutical ingredients (APIs), pharmaceutical intermediates, specialty chemicals, and formulations in India and internationally. The company offers aceclofenac, celecoxib, diclofenac sodium, diclodenac potassium, diclofenac diethylamine, diclofenac resinate, diclofenac epolamine, nimesulide, ciprofloxacin HCL, enrofloxacin base, gatifloxacin sesquihydrate, levofloxacin base, norfloxacin, ofloxacin, metronidazole, metronidazole benzoate, ornidazole, secnidazole, tinidazole, clopidogrel bisulphate, ticlopidine HCL, metformin HCL, pioglitazone HCL, teneligliptin, vildagliptin, fluconazole, ketoconazole, tolnaftate, zolpidem tartrate, niacin, raloxifene HCL, and acamprosate. It also provides benzene sulphonyl chloride, benzene sulphonic acid, methyl benzenesulfonate, sodium benzene sulfinate, para toluene sulphonyl chloride, methyl para toluenesulfonate, sodium para toluenesulfinate, para chlorobenzenesulfonyl chloride, formamide, calcium fluoride, potasium formate, benzenesulfonamide, ethyl p- toluenesulfonate, N,N',N'-tris-(4-toluene sulfonyl)-diethylenetriamine, ortho para toluene sulfonamides, ortho para toluene sulfonamides acid methyl ester, para chlorobenznesulfonamide, para toluenesulfonyl hydrazide, para toluenesulfonamide, and sodium benzenesulfonate. In addition, it offers pharma intermediate products, which includes Celecoxib, Ciprofloxacin, Clopidogrel, Diclofenac, Ketoconazole, Nimesulide, Raloxifene, Tinidazole, and Zolpidem. Further, the company develops drugs for antifungal, cardiovascular, and antidiabetic therapeutic areas, as well as non-steroidal anti-inflammatory drugs. The company was incorporated in 1984 and is headquartered in Mumbai, India.