Aarey Drugs and Pharmaceuticals Ltd

Aarey Drugs and Pharmaceuticals Ltd has a debt-to-equity ratio of 0.24, indicating a relatively conservative capital structure with limited leverage. However, the company's liquidity position is assessed as medium risk, with negative net cash after subtracting total debt. The current ratio of 1.7 suggests the company has sufficient short-term assets to cover its short-term liabilities, but the negative operating cash flow of -29.9 million INR raises concerns about its ability to generate cash from operations.

Profitability metrics show mixed results. The company's return on equity (ROE) is 1.62%, and return on assets (ROA) is 0.71%, both below the typical thresholds for strong performance in the pharmaceutical industry. The net income of 21.5 million INR is positive, but the operating income is negative at -18.4 million INR, indicating operational inefficiencies or high costs.

The company's revenue is concentrated in a single business segment, as disclosed in its financial statements, with no geographic diversification provided in the available data. This lack of segment and geographic diversification increases exposure to market-specific risks.

The company's growth trajectory is uncertain. Revenue for the latest period is 2.1 billion INR, but there is no disclosed revenue growth rate or outlook for the next fiscal year. The negative operating cash flow and operating income suggest that the company may face challenges in sustaining or growing its revenue in the near term.

The company's risk profile includes medium liquidity risk and low dilution risk. The negative net cash position after subtracting total debt is a key flag, and the absence of significant dilution risk suggests that the company is not currently issuing new shares at a high rate. No material adjustments were applied to the valuation metrics.

Recent filings and transcripts do not provide specific details on strategic initiatives or major events. The company's 10-K filing does not disclose any material changes in business strategy or significant legal proceedings that would impact its operations or financial position.

Revenue grew 19.8% year-over-year to INR 4.74 billion, demonstrating top-line expansion despite margin pressures.

The debt-to-equity ratio of 0.24 is below the pharmaceutical cohort median of 0.18, indicating conservative leverage.

Capital expenditure relative to revenue is in the top quartile, suggesting strong investment in future growth capacity.

Dilution and credit risks are assessed as low, providing a stable capital structure for long-term investors.

Return on invested capital is negative at -1.12%, indicating the company destroys value on deployed capital.

Cash conversion is in the bottom quartile of the cohort, highlighting poor ability to turn profits into cash.

Revenue INR 3.96B, −5,6% YoY; Operating income −58,3% YoY.

• ▍Revenue INR 3.96B, −5,6% YoY
• ▍Operating income −58,3% YoY
• ▍Net income +24,2% YoY
• ▍Free cash flow +31,6% YoY
• ▍Net margin 1.2%

Revenue INR 4.19B, −15,0% YoY; Operating income −28,9% YoY.

• ▍Revenue INR 4.19B, −15,0% YoY
• ▍Operating income −28,9% YoY
• ▍Net income −42,4% YoY
• ▍Free cash flow −32,1% YoY
• ▍Net margin 0.9%

Revenue INR 4.93B, +41,4% YoY; Operating income +149,6% YoY.

• ▍Revenue INR 4.93B, +41,4% YoY
• ▍Operating income +149,6% YoY
• ▍Net income +0,5% YoY
• ▍Free cash flow +39,0% YoY
• ▍Net margin 1.3%

Revenue INR 3.48B; Operating income INR 37.2M.

• ▍Revenue INR 3.48B
• ▍Operating income INR 37.2M
• ▍Net margin 1.9%