Aarti Industries Limited (AIL), a leading Indian specialty chemicals company, has reported a robust 26% year-over-year revenue growth for the second quarter of fiscal year 2026, with consolidated revenues reaching Rs. 2,250.00 crore. The company's performance was primarily driven by increased volumes in Methyl Methacrylate (MMA) products and benefits from deferred bulk shipments from Q1.

Key Financial Highlights

Operational Highlights

• MMA production achieved its highest quarterly output with 98% capacity utilization at 260 KT capacity.
• The company secured a long-term chlorine supply agreement with DCM Shriram, increasing supply from 150 TPD to 350 TPD to support future downstream growth.
• AIL is fast-tracking execution of capacity expansions, including MMA debottlenecking to 300 KT and PEDA capacity of 4000 MT, both expected to commission in Q4 FY26.

Financial Performance

Aarti Industries demonstrated strong financial performance in Q2 FY26, with consolidated revenue growing by 26% year-over-year and 21% quarter-over-quarter. The EBITDA saw a significant increase of 44% YoY and 36% QoQ, reaching Rs. 292.00 crore. The company's Profit After Tax (PAT) more than doubled, showing a remarkable 102% YoY growth and 150% QoQ growth to Rs. 105.00 crore.

Operational Performance

The company's MMA segment was a key driver of growth, achieving its highest quarterly production with 98% capacity utilization. This performance underscores AIL's operational efficiency and strong market demand for MMA products.

Strategic Developments

Aarti Industries has made strategic moves to ensure sustained growth:

1. Long-term Chlorine Supply Agreement: AIL secured a crucial agreement with DCM Shriram, significantly increasing its chlorine supply from 150 TPD to 350 TPD. This agreement is aimed at supporting future downstream growth and enhancing supply chain security.

2. Capacity Expansion: The company is accelerating its capacity expansion plans, with two key projects slated for commissioning in Q4 FY26:

   • MMA debottlenecking to increase capacity to 300 KT
   • PEDA (2-Phenyl Ethyl Diethyl Aniline) capacity addition of 4000 MT

Challenges and Outlook

Despite the strong performance, Aarti Industries faces some challenges:

• Margins remain under pressure across most product portfolios.
• US tariffs have impacted volumes for key end-use applications, including dyes and polymers.
• Finance costs included a forex mark-to-market loss of Rs. 34.00 crore on ECB borrowings.

However, the company's proactive approach to capacity expansion and strategic partnerships positions it well for future growth. The fast-tracking of capacity expansions, particularly in MMA and PEDA, indicates AIL's confidence in market demand and its ability to capitalize on emerging opportunities.

Exceptional Items

The quarter saw some exceptional items impacting the financial results:

• The company received favorable income tax appellate orders resulting in exceptional income of Rs. 29.00 crore.
• Exceptional expenses included a Rs. 7.00 crore provision for doubtful land advance.

Aarti Industries' strong performance in Q2 FY26, coupled with its strategic initiatives and capacity expansions, suggests a positive outlook for the company. However, the management remains cautious about margin pressures and the impact of US tariffs on certain product segments. As AIL continues to execute its growth strategy, investors and industry observers will be watching closely to see how these factors play out in the coming quarters.

Aarti Industries , a leading specialty chemicals manufacturer, has reported a significant increase in its net profit for the quarter ended September 30, 2025. The company's financial performance shows notable growth in both revenue and profitability.

Financial Highlights

• Net profit surged to Rs 101.00 crores, marking a 130% increase from Rs 44.00 crores in the previous quarter.
• Revenue from operations rose to Rs 2,085.00 crores from Rs 1,636.00 crores quarter-on-quarter, representing a 27.4% growth.
• The company recorded exceptional income of Rs 22.00 crores, primarily from interest income on historic income tax appeals.

Quarterly Performance Breakdown

Key Factors Influencing Results

1. Exceptional Income: The company received Rs 29.00 crores in interest income from favorable rulings on historic income tax appeals for assessment years 2010-11 to 2019-20.

2. Provision for Advance Payment: Aarti Industries made a Rs 7.00 crores provision for an advance payment to an NBFC for land purchase, which is currently under dispute.

3. Half-Year Performance: For the half-year period, net profit decreased to Rs 144.00 crores from Rs 193.00 crores in the previous year.

Operational Highlights

• The company operates primarily in the specialty chemicals segment.
• Aarti Industries maintains AA/Stable credit ratings from CRISIL and India Ratings.
• Commercial papers outstanding as of September 30, 2025, stood at Rs 400.00 crores.

Management Commentary

Rajendra V. Gogri, Chairman and Managing Director of Aarti Industries, stated in the company's financial results, "The Board of Directors has approved the Unaudited Standalone and Consolidated Financial Results for the Quarter and Half Year ended September 30, 2025, upon recommendation of the Audit Committee."

Future Outlook

While the company has shown strong growth in the second quarter, it remains cautious about future prospects. The provision for the disputed land purchase advance indicates a prudent approach to potential risks.

Aarti Industries' focus on the specialty chemicals segment and its stable credit ratings suggest a solid foundation for future operations. However, investors should note that past performance does not guarantee future results, and market conditions may impact the company's performance in upcoming quarters.

Note: All financial figures are based on the standalone results provided in the company's official statement.