Aarti Surfactant (AARTISURF)

FairStock Score: 50/100 — MIXED

Score breakdown: P/E: 2/3 · ROCE: 0/2 · Growth: 2/2 · Dividend: 0/1

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

When I study Aarti Surfactant, I see a small-cap specialty chemical company that looks cheap on the surface but demands caution. It trades at ₹398.55, near its 52-week low of ₹316, with a market capitalization of just ₹343 crore. The P/E of 19.17 seems reasonable, and the PEG ratio of 0.10 suggests the market is underpricing growth. But that 357% profit growth is a red flag—it is likely a base effect from a weak prior year. In the latest quarter, Aarti generated ₹208 crore in sales yet only ₹4 crore in net profit, a margin below 2%. That is not a high-quality earnings engine. Return on equity stands at 8.17%, and ROCE at 8.50%—both below what I would demand from a business with a durable moat. Book value is ₹262.81, so the price-to-book of 1.52 is not excessive, but you are paying a premium for subpar capital efficiency. Debt-to-equity of 0.50 is manageable, and the Piotroski F-score of 7 suggests decent financial health. Sales growth of 27.65% is encouraging, but I worry about translation into profits. Promoter holding at 49.88% is a positive, aligning interests with minority holders. The dividend yield of 0.25% is negligible. This looks more like a turnaround or cyclical play than a stalwart. Without sustained margin expansion and a higher return on equity, I would hesitate to commit capital. As Graham said, price is what you pay, value is what you get—and here, value is yet to be proven.

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Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer