Strong top‑line and profit growth Aarti Industries announced a robust Q2FY27 performance, posting revenue of **Rs36.7 billion**, up **75% year‑on‑year**. EBITDA rose to **Rs4.1 billion**, a **41% increase** from the same quarter last year. The surge was anchored by two main drivers: a sharp rise in sales volumes and the company's ability to pass through higher raw‑material costs to customers.
Energy and non‑energy segments both in favour The **Energy segment** recorded solid growth, helped by a rise in crude oil prices and wider gasoline‑naphtha crack spreads. Meanwhile, **non‑energy value chains**—including **NCB (Naphtha Cracking), DCB (Distillate Cracking) and pharmaceutical** segments—saw healthy volume expansion. The **PDA (Petrochemical Derivatives) business**, however, continues to feel pressure from Chinese imports priced below domestic levels.
Management outlook and operational focus Company leadership expects the current momentum to persist. Key pillars of the outlook include: - **Ramp‑up of newly commissioned Zone IV facilities**, which should lift capacity utilisation. - **Execution of long‑term contracts** already signed, providing revenue visibility. - **Continued demand improvement** across core value chains.
The firm also highlighted several risk factors that will be monitored closely: **elevated raw‑material prices**, **higher working‑capital requirements**, and the possibility of **inventory write‑downs**.
Analyst rating and valuation Prabhudas Lilladher maintains an **Accumulate** rating on Aarti Industries, setting a **target price of Rs476**. The valuation implies a **21× multiple on the projected Sep'28 earnings per share**, compared with the stock’s current **17× FY29 EPS** multiple.
What investors should watch - **Utilisation rates at Zone IV** as the plant reaches full operational capacity. - **Raw‑material price trends**, especially for key petrochemical feedstocks. - **Competitive dynamics in the PDA segment**, particularly any further price actions from Chinese exporters. - **Progress on long‑term contract sign‑offs**, which could underpin future revenue streams.
Overall, Aarti Industries’ Q2FY27 results suggest a strong near‑term earnings trajectory, but the company’s ability to manage cost pressures and inventory risks will be critical for sustaining growth.