Last Updated2026-06-02

Market View

₹469.75(▼0.24%)

Reporting PeriodQ4 FY26

AARTIINDAarti Industries Limited Forensic Risk Analysis

Name: Aarti Industries Limited Structural Risk Analysis
Creator: Flagium AI
License: https://creativecommons.org/licenses/by-nc-nd/4.0/

Specialty Chemicals

Risk ClassWatch

Market Cap₹15,673 Cr

Primary DriverBalance Sheet Stress

Flagium AI Risk Score

20 / 100

-5 QoQ

Improving

Sentinel Insight

Financial profile remains stable for now. Pressure is receding in balance sheet stress. This suggests the risk profile is currently stabilizing. Risk levels are improving.

46.0th %ile (Sector)Accel: +0 Qtrs

Updated2026-06-02

Market View

₹469.75▼0.24%

PeriodQ4 FY26

Score Waterfall
Absolute contribution points of each forensic pillar to the final risk score. Derived from: Sector Baseline + Active Penalties - Mitigation Buffers.

Balance Sheet Stress

+20.0 pts

Final Composite Risk20 / 100

Investment Risk Thesis

Historical Trend

Current risk score has risen from 11 → 20 over 13 quarters.

Expected Direction

🟢 Improving

Primary Deterioration Drivers

Margin Compression
Inventory Stress
Relative Growth Weakness

What to Watch Next Quarter

Working capital efficiency
Operating profit margins
Inventory turnover

Active Risk Objects (10)

CriticalHigh

Working Capital Expansion

💧 Liquidity & CoverageAnnualActive for 2 Years

More Detail

Impact Weight10/15

MomentumAccelerating

Last SignalQ4 FY2026

Working capital expansion detected: Receivable days increased by 57.5%.

"Early signs of working capital expansion. Receivable or inventory days are creeping up."

Margin Compression

📊 Earnings QualityAnnualActive for 2 Years

More Detail

Impact Weight15/15

MomentumAccelerating

Last SignalQ1 FY2026

Operating margin declined by 5.3 bps YoY for two consecutive quarters.

"Early signs of margin erosion. Input costs are beginning to eat into core profits."

Capex Efficiency Stress

📊 Earnings QualityAnnualActive for 1 Years

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Impact Weight8/15

MomentumDecaying

Last SignalQ2 FY2024

Aggressive Capex (39.5%) amidst slow revenue growth (-13.7%).

"Earnings quality is stabilizing. The reliance on non-operational items is receding."

Profit Collapse

📊 Earnings QualityQuarterlyActive for 3 Qtrs

More Detail

Impact Weight8/15

MomentumDecaying

Last SignalQ1 FY2026

AARTIIND: Net Profit collapsed by 68.3% from FY2025 Q1 to FY2026 Q1.

"Earnings quality is stabilizing. The reliance on non-operational items is receding."

Relative Growth Weakness

📊 Earnings QualityAnnualActive for 1 Years

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Impact Weight12/15

MomentumAccelerating

Last SignalQ1 FY2026

Revenue growth consistently lags behind sector median (12.8%).

"Earnings quality is under severe pressure. High accruals suggest potential revenue overstatement."

Negative FCF Streak

⚖️ Governance SignalsAnnualActive for 3 Years

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Impact Weight6/15

MomentumPersistent

Last SignalFY2026

AARTIIND: Negative Free Cash Flow for last 3 consecutive years.

"High capital expenditure and low OCF are draining cash. Debt levels may rise sharply."

Inventory Stress

📊 Earnings QualityAnnualActive for 2 Years

More Detail

Impact Weight15/15

MomentumDecaying

Last SignalQ2 FY2025

Inventory growth (29.5%) significantly outpaced revenue growth (12.3%).

"Inventory overhang is clearing. Stock levels are normalizing as sales momentum returns."

Low Interest Coverage

💧 Liquidity & CoverageQuarterlyActive for 7 Qtrs

More Detail

Impact Weight8/15

MomentumPersistent

Last SignalQ4 FY2026

AARTIIND: Low Interest Coverage Ratio of 1.99x in FY2026 Q4 (Threshold: 2.5x).

"Earnings buffer for interest payments is narrowing. Monitor for margin pressure."

Operating Leverage Stress

📊 Earnings QualityAnnualActive for 2 Years

More Detail

Impact Weight10/15

MomentumAccelerating

Last SignalQ1 FY2026

Expenses are consistently growing faster than revenues, creating operational pressure.

"Debt levels are creeping up. Monitor for signs of excessive borrowing for non-core activities."

Revenue-Debt Divergence

🏛️ Solvency & LeverageAnnualActive for 1 Years

More Detail

Impact Weight6/15

MomentumDecaying

Last SignalFY2024

AARTIIND: Revenue fell 3.6% while Debt rose 10.8% in 2024 vs 2023.

"Debt servicing metrics have improved recently. The company is actively deleveraging."

Risk Trajectory

Loading Chart

Resilience Matrix

Metric	Value	vs Sector	Signal
Volatility (σ)	5.92	10.68	✅ RESILIENT
Sensitivity (ε_s)	1	1.00	✅ RESILIENT
Escalation Prob.	5%	5%	✅ NEUTRAL
Safety Buffer	+46.0	+46.0	✅ RESILIENT

Forensic Benchmark Context: Specialty Chemicals (n=51 peers)

Correlation Analysis
Visualizing the relationship between stock price movement and structural risk objects.

Loading Chart

Share Price

Risk Score (0-100)

Market Performance

₹469.75(-0.24%)

1M Divergence-9.71%

1 Week-4.33%

1 Month-7.44%

6 Months+27.08%

1 Year+0.07%

2 Year-22.88%

3 Year-7.87%

Sector Average (1M)+2.27%

Sentinel Forensic Assessment

ALGORITHMIC RISK PROFILE • NON-ADVISORY

The risk profile is Early Signals and currently improving. Recent structural triggers in balance sheet stress suggest a building pressure on the underlying framework. Material forensic traces are visible in core structural metrics, indicating a progressive erosion of structural stability. Initial structural recovery is visible; monitor for a sustained return to resilience.

AARTIIND • MARKET STRUCTURE

Stage 2 — Advancing

The company is in a growth phase. Institutional sentiment is highly positive, supported by strong fundamentals and sustained risk reduction.

Stage Transition Prob.96%

Trend QualityStrong

Phase Progression

Phase Progression Score75%

Readiness LabelHigh (Phase Transition Imminent)

Probability of Advancing96%

CoinTree Momentum

Composite Z-Score+0.1755σ

Improving momentum strength

Universe Rank#718 of 2716

Top 26.44% in momentum strength

Timeframe Sparklines

1W-4.3%

1M-7.4%

6M+27.1%

Weinstein Indicators

150 DMA₹414.96

200 DMA₹406.61

150 DMA Slope+3.3402%Rising

Relative Strength+32.57%Leading

Relative Turnover (RTR)1.4322

ParticipationHealthy

PEER COMPARISON

Ranked comparison against sector peers

Risk profile is broadly in line with the Sector Mean (20).

Ticker	Risk Score	Sector %ile	Delta	Flags	Accel	Primary Driver
AARTISURFAarti Surfactants Limited	15	32th	+2	17	+1	Earnings QualityStable
AARTIINDAarti Industries Limited	20	46th	-5	10	+0	Balance Sheet StressWatch
ANURASAnupam Rasayan India Limited	31	78th	+16	29	+2	Balance Sheet StressWatch
ACIArchean Chemical Industries Limited	35	84th	+20	22	+1	Earnings QualityWatch