Aarti Industries rose 5.39% to Rs 1,126.20 at 11:43 IST on BSE after the company signed 20-year exclusive contract worth Rs 10000 crore with a global chemical company for supplying high value speciality chemical intermediate.
The announcement was made during trading hours today, 29 December 2017.Meanwhile, the S&P BSE Sensex was up 175.73 points, or 0.52% to 34,023.76.
On the BSE, 55,000 shares were traded in the counter so far, compared with average daily volumes of 18,000 shares in the past two weeks. The stock had hit a high of Rs 1,159.90 and a low of Rs 1,084.95 so far during the day. The stock hit a record high of Rs 1,162.80 on 22 December 2017. The stock hit a 52-week low of Rs 673.65 on 29 December 2016.
Aarti Industries said it signed Rs 10000 crore multi-year deal with a global chemical company. The contract entails supply of a high value speciality chemical intermediate over a period of 20 years. The supplies are expected to commence from 2020 with an estimated revenue generation of 10000 crore over the contract period. With this deal, Aarti Industries is set to enter a new chemistry range, first of its kind in India; and its end product is amongst the major growth initiatives for the customer.
Aarti Industries will be investing $35 - $40 million to setup dedicated large scale manufacturing facility for production of this speciality chemical intermediate, and will be built on the basic technology package received from the customer. The upcoming facility will be a 100% export oriented unit in Gujarat. As a part of this contract terms, the customer shall provide $42 million as an advance to Aarti Industries in installments, which shall be adjusted against the supplies in future. This advance shall help reduce the net capital employed, enabling higher ROCE returns for this project.
Net profit of Aarti Industries rose 3.30% to Rs 78.51 crore on 25% rise in net sales to Rs 887.89 crore in Q2 September 2017 over Q2 September 2016.
Aarti Industries is a leading manufacturer of speciality chemicals.
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