Aarti Drugs plunges as Q4 results below Street estimates

MUMBAI: Shares of Aarti Drugs closed the day at Rs 687.50; down 6.78%. The stock slipped over 8.3 per cent in intraday trade as its results for Q4FY15 were below Street expectations. In addition, sales and profits were down over last year.

Net profit declined to Rs 18.9 crore, down 14 per cent as compared to a net profit of Rs 21.9 crore in the corresponding quarter last fiscal. Sales for the quarter decline to Rs 277 crore, down 2 per cent, from Rs 282 crore in the same quarter a year-ago.

Adhish Patil, CFO, Aarti Drugs in an interview to ET Now said that currency movement across the globe and boiler shutdown for 10 days affected business in the quarter. He sees demand picking up in the next quarter.

The management had forecasted 20 per cent CAGR revenue growth over next 3 years but its FY15 revenues have grown only 12 per cent.

"Our forecast for next 3 years remains the same; looking to grow 20 per cent in FY16," he told ET Now.

The next cycle of growth for the company would come out of capacity expansion and new products, say analysts.

According to the management, the company will be spending Rs 90-100 crore for Capex over next one year. It will be funded by debt.

Aarti Drugs’ domestic sales have grown 18 per cent over last year while US markets formed close to 3 per cent of sales.