Prabhudas Lilladher's research report on Aarti Industries
We leave the estimates largely unchanged for FY21/22E. AIL's near term growth trajectory will face headwinds from weakness in discretionary spend (textiles, autos, aerospace etc; ~40% of AIL's revenues) and weak global macro-economic situation. Increased competition from China due to export benefits is an added risk. AIL with a diversified product portfolio of 200 products remains well placed to capitalize on rising investment in domestic downstream industries, along with production shift from China.
Outlook
We remain structurally positive on AIL's growth prospects but will wait for better entry points given the macro challenges. Downgrade to ACCUMULATE from BUY with a PT of Rs992 (Rs 988 earlier) based on 24x FY22E.
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