Aarti Industries Secures Long Term Methanol and Toluene Supply to Strengthen Raw Material Sourcing

19 Dec 2025 , 12:20 PM

Aarti Industries Ltd said on Thursday that it has tied up long term supply arrangements for methanol and toluene, two raw materials that sit at the heart of its specialty chemicals business, according to an exchange filing. The company said the contracts have been signed with overseas manufacturers and suppliers located across the GCC region and parts of South East Asia, adding that these arrangements are expected to meet a meaningful share of its yearly requirement for both inputs, even though details around pricing and tenure were not disclosed.

People familiar with the matter said methanol and toluene are widely used across several of the company’s downstream products, many of which are supplied to pharmaceutical makers, agrochemical firms, FMCG companies and niche industrial customers. With supply chains remaining unpredictable in parts of the world, the company appears to be focusing on locking in availability rather than chasing short term price advantages, a move that could help keep operations steady during periods of volatility.

Company executives indicated that the long term nature of the contracts should give better clarity on sourcing costs and reduce uncertainty around raw material availability. This is expected to support smoother production planning and limit disruptions at manufacturing sites, particularly when global trade conditions tighten or logistics face delays. Management believes the step will also help maintain consistent deliveries to customers across domestic and international markets.

Commenting on the development, CEO and Executive Director Suyog Kotecha said that dependable access to critical raw materials remains central to the company’s long term plans. He said the agreements strengthen the supply chain and give the business greater confidence in meeting customer commitments while continuing to scale its specialty chemicals portfolio globally.

The announcement comes alongside a sharp improvement in the company’s quarterly numbers. For the second quarter of FY26, Aarti Industries reported a net profit of ₹106 crore, compared with ₹52 crore in the same period last year. Revenue from operations rose to ₹2,100 crore from ₹1,628 crore a year earlier, while EBITDA jumped to ₹291 crore. The operating margin also improved to 13.9 percent from 12.1 percent, supported by better realisations and tighter cost control.

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