Aarti Industries Share Price Trades Higher After Company Announces Rs 250 Crore Backward Integration Project
The company has a market cap of Rs 14,975.15 crore. The stock price has declined 24.23 per cent in the last 3 years.
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On Thursday, shares of Aarti Industries Ltd jumped 0.12 per cent to Rs 413 per share from its previous closing of Rs 412.50 per share. The stock’s 52-week high is Rs 495 per share and its 52-week low is Rs 338.05 per share. The stock surged 2.84 per cent to its Intraday high of Rs 423.70 from the previous close. As of 10:51:15 IST, the shares were trading at Rs 413.
Aarti Industries Ltd (AIL), a global leader in specialty chemicals, has announced a strategic expansion of its partnership with a leading global chemical company through a material amendment to its existing exclusive long-term supply agreement. The amendment focuses on exclusive backward integration and overall value addition.
Under the extended agreement, the company will transition to a highly integrated, end-to-end manufacturing model for a high-value specialty chemical intermediate. To support this move, AIL plans to invest approximately Rs 200–250 crore over the next two years to establish a backward integration facility.
The new plant will manufacture a significant portion of a critical feedstock that was earlier supplied by the customer. The facility will be developed at AIL’s existing site in the Dahej SEZ, Gujarat, ensuring seamless integration with current operations and infrastructure.
The shift to in-house manufacturing is expected to deliver multiple operational benefits. These include cost optimisation through lower operating expenditure and reduced freight costs, improved supply chain resilience, and enhanced safety standards in material handling.
While the company does not expect the integration to materially impact its topline growth, it anticipates a positive impact on EBITDA margins over the remaining 15-year tenure of the main agreement, driven by better operating leverage and integration efficiencies.
Commenting on the development, CEO Suyog Kotecha said the move reflects the deep trust placed in AIL’s capabilities. He noted that the backward integration will enhance supply security, improve cost competitiveness, and strengthen EBITDA over the life of the agreement. He also highlighted that the project reinforces India’s growing position as a technologically advanced and reliable manufacturing partner for global chemical majors, including those based in the U.S. and Europe.
AIL is recognised as a Partner of Choice for major global and domestic customers and ranks among the top four players globally for 75 per cent of its product portfolio. The company combines complex process chemistry with scale-up engineering expertise while maintaining a strong focus on sustainable development and ecological responsibility.
The company has a market cap of Rs 14,975.15 crore. The stock price has declined 24.23 per cent in the last 3 years.
Disclaimer: The article is for informational purposes only and not investment advice.