AAREY DRUGS & PHAR­MA­CEU­TI­CALS

I bought 2000 shares of Aarey drugs at ₹104. Kindly tell if I should Hold it or sell it? - Noor

Dalal Street Investment Journal - - QUERY BOARD -

Aarey Drugs & Phar­ma­ceu­ti­cals Limited is en­gaged in the busi­ness of ac­tive phar­ma­ceu­ti­cal in­gre­di­ents (Apis)and bulk drugs man­u­fac­tur­ing. It of­fers a range of prod­ucts for var­i­ous in­dus­trial ap­pli­ca­tions. The com­pany en­ga­gesin trad­ing and man­u­fac­tur­ing ac­tiv­i­ties. It­man­u­fac­ture­sand sup­plies phar­ma­ceu­ti­cal raw ma­te­ri­als, chem­i­cals, phar­ma­ceu­ti­cal in­gre­di­ents, API’S drugs, food colours and flavours. The com­pany’s as­sort­ment of phar­ma­ceu­ti­cal prod­ucts in­clude metron­ida­zole and metron­ida­zole ben­zoate. Its prod­ucts in­clude monomethyl urea (MMU, dimethyl urea (DMU), theo­bromine (THB), theo­phylline (THP) and pen­tox­i­fylline (PTF). The com­pany is also in­volved in other busi­nesses, in­cludin­garo­matic chem­i­cals, chem­i­cal acid, chlo­ral­ka­lis, in­dus­trial al­co­hols, in­dus­trial ke­tones, gly­cols and gly­col ethers, fi­bre in­ter­me­di­ates, in­dus­trial amines, ac­etates and es­ters, chlo­ri­nated sol­vents, in­dus­trial in­ter­me­di­ates and in­dus­trial chem­i­cals.

On the fi­nan­cial front, Aarey Drugs posted 22.02 per cent de­cline in its net sales to ₹73.78 crore in the first quar­ter of

FY18, as against ₹94.61 crore in the same quar­ter of the pre­vi­ous fis­cal. The com­pany’s PBIDT also got re­duced by 20.73 per cent to ₹1.50 crore in Q1FY18 as com­pared to ₹1.89 crore in the same quar­ter of the pre­vi­ous fis­cal. How­ever, the com­pany’s profit af­ter tax in­creased sub­stan­tially by 73.02 per cent to

₹1.91 crore in the first quar­ter of FY18, as against ₹1.10 crore in Q1FY17.

On an an­nual ba­sis, the com­pany’s net sales grew by 60.94 per cent to ₹395.97 crore in FY2017 as against ₹246.03 crore in the pre­vi­ous fis­cal. The com­pany’s PBIDT in­creased mas­sively by 982.95 per cent to ₹9.53 crore in FY17 as com­pared to ₹0.88 crore in the pre­vi­ous fis­cal. The com­pany’s profit af­ter tax in­creased by 355.81 per cent to ₹5.88 crore in FY17 against ₹1.29 crore in FY16.

We rec­om­mend the reader-in­vestors to Hold the stock.

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