Buy Aarti Drugs, target price Rs 545: Axis Securities

Axis Securities has buy call on Aarti Drugs with a target price of Rs 545. The current market price of Aarti Drugs Ltd. is Rs 464.5.

Aarti Drugs Ltd., incorporated in the year 1984, is a Small Cap company (having a market cap of Rs 4297.10 Crore) operating in Pharmaceuticals sector.

Aarti Drugs Ltd. key Products/Revenue Segments include Pharmaceuticals for the year ending 31-Mar-2022.


Financials
For the quarter ended 30-09-2022, the company reported a Consolidated Total Income of Rs 687.77 Crore, up 10.53 % from last quarter Total Income of Rs 622.22 Crore and up 18.64 % from last year same quarter Total Income of Rs 579.70 Crore. Company reported net profit after tax of Rs 38.74 Crore in latest quarter.

Investment Rationale
API demand has started to pick up as inventories of large formulation players have corrected which was full during the covid period plus raw prices of base chemicals has started to correct. Freight prices are also showing corrections in the last three months. Therefore, Aarti Drugs could be benefitted in upcoming quarters, the brokerage upgrades to BUY on Aarti Drugs with Target Price of Rs 545.

Promoter/FII Holdings
Promoters held 59.98 per cent stake in the company as of 30-Jun-2022, while FIIs owned 2.07 per cent, DIIs 2.76 per cent.