Aarti Drugs Limited — Q3 FY26
Aarti Drugs reported a mixed Q3 FY26 with consolidated revenue of ₹602.9 crore (+8% YoY) but EBITDA margin contracting to 9.3% (-180bps YoY) due to low capacity utilization, Chi...
neutral
medium
✓ Verified against BSE filing
Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
96%Questions answered0Evaded / deflected12Questions auditedContradictedNumbers vs filing
Answered
Medium priority
Intention of formulation business: only APIs or also other molecules?
Asked by Vishal, Systematics
Management clearly stated they do both, with no restriction.
Read the exchange
Question
whether on the formulation business the primary intention is to do all the formulations of the existing APIs that we large capacities for or we would also do other formulations beyond our APIs that we are traditionally strong at.
Vishro (Management)
currently we are doing both. We are working on formulations of APIs that Aarti drugs is manufacturing in house. But we are not restricting to that. Especially on our pipeline we are focusing more on niche categories into the oncology and cardiabetic range.
Partial answer
High priority
Quantify savings from backward integration projects at peak utilization.
Asked by Vishal, Systematics
Provided a rough number but with many caveats.
rough estimate givenconditional on prices
Read the exchange
Question
if you can quantify with the backward integration projects... what would be the savings that we'll generate in the numbers?
Management (unclear name)
it should give a boost of say you know at least a couple of percent in gross contribution at the company level... if run at full scale potential the can be slightly upward of 50 crores
Answered
High priority
Quantify impact of shutdowns and new facilities on this quarter.
Asked by Risham Jen, BBD Asset Managers
Management gave specific numbers for EBITDA and PBT impact.
Read the exchange
Question
if it is possible to quantify all the things which you have mentioned in your opening remarks with respect to shutdown and some of the new facilities coming up... how much impact would be there in this quarter?
Management (unclear name)
at the EBITDA level it could have created a drag of roughly 8 or 8 and a half crores and at the PBT level probably it would be around some 14 15 crores
Answered
High priority
Capex for FY27 beyond the planned 600 cr cycle.
Asked by Risham Jen, BBD Asset Managers
Management gave a clear range for annual capex.
Read the exchange
Question
what is the capex let's say in FY27 beyond what we have earlier planned for?
Management (unclear name)
I would still maintain that you know around 150 to 200 crores of capex you can expect for the next two years each every year
Answered
High priority
Volume growth trajectory for FY27 and whether new projects drive it.
Asked by Dwani Desai, Turtle Capital
Management gave a specific volume growth range.
Read the exchange
Question
should we expect those kind of volume and hence value growth going forward into FY27 also?
Management (unclear name)
we can expect around you know 12 to 15% volume growth in FY27 with both the projects going smooth
Answered
High priority
Gross margin trajectory for FY27 with backward integration.
Asked by Dwani Desai, Turtle Capital
Management gave a specific margin target.
Read the exchange
Question
how should we look at this margin trajectory going into FY27?
Management (unclear name)
36% gross margin is fair to assume it is not that tough to achieve 36%.
Answered
Medium priority
Why continue capex when plants are still scaling up?
Asked by Dwani Desai, Turtle Capital
Management explained rationale with specific timelines.
Read the exchange
Question
why is it that we don't want to kind of first stabilize and get to the good operational efficiency level and then do the capex?
Management (unclear name)
the sika plant has operationalized very smoothly... we'll know within 6 months whether one of the greenfield capex is fully operationalized or not.
Answered
High priority
Salicylic acid realizations and Chinese dumping status.
Asked by Yoshi, UNIC Capital Private Limited
Management gave a clear update on realizations and dumping.
Read the exchange
Question
have the realizations stabilized or they are still the dumping is still on and the realizations have come down?
Management (unclear name)
Chinese dumping is still on but due to dollar going up we are getting little better realization than last quarter
Answered
High priority
Steady-state EBITDA margins next year.
Asked by Yoshi, UNIC Capital Private Limited
Management gave specific margin targets.
Read the exchange
Question
next year steady state what will be around?
Management (unclear name)
first we'll come there 12 to 13% and then from there the ideal steady state margins... should be somewhere in 14 to 15% range
Answered
High priority
API pricing trajectory and whether bottom has been reached.
Asked by Adita, Soilo Investments
Management gave a specific price decline and stated stabilization.
Read the exchange
Question
what kind of trajectory are we seeing especially for API?
Management (unclear name)
overall negative price variance in December quarter with respect to September 25 is roughly around 2 to 2 and a half%... we will still maintain the stance that the prices have stabilized from September onwards.
Answered
High priority
Total investment in oncology business including dossier development.
Asked by Vishal, Systematics
Management gave specific investment numbers.
Read the exchange
Question
can you share what would be the total investment including the dossier development cost we'll be making in the oncology business?
Misha (Management)
facility capex would be about 50 crores and in terms of product development and regulatory it would be about again 50 to 60 crores every year for the next three years.
Answered
Medium priority
Why choose salicylic acid as import substitute over metformin?
Asked by Vishal, Systematics
Management explained the rationale in detail.
Read the exchange
Question
why we kind of chose salicylic as a import substitute option while there were so many you could have also chosen a backward integration project for metformin?
Management (unclear name)
we studied pricing trend of salicylic acid for five to six years... that time no one was manufacturing that product and the technology showed very high profit margin... but when we entered the market China started crashing the prices.
Quantitative claims vs filed numbers
| Claim | Management said | Filing | Verdict |
|---|---|---|---|
| EBITDA drag of 8-8.5 cr from greenfield projects | ₹8.5 cr | ₹56.3 cr | Understated vs filing |
| Gross margin impact of 1% from inventory sales | 1% | 9% | Understated vs filing |
| Consolidated gross margin 35.9% | 35.9% | 9% | Overstated vs filing |
| Volume growth target 12-15% for FY27 | 15% | 8.2% | Overstated vs filing |
| Steady-state EBITDA margin target 14-15% | 15% | 9% | Overstated vs filing |
Filed figures sourced from Screener.in. Claims within a small tolerance of the filing are marked “matches filing”.