Stock Review: ARIES AGRO

After doubling in two years prior to the IPO, Aries Agro's net profit plunged by 88.5% in FY09, the year following its IPO. In FY10, the company recovered the lost ground and reported a profit above its FY08 level. In the past one year, the scrip has moved in line with the market forces as reflected by its beta of 0.95, while outperforming the BSE Sensex. Although with some delay, the company has kept its IPO promise of multifold increase in production capacities. Its annual report for FY10 mentioned its production capacity at 84,600 tonne capacity in India apart from 70,000 tonne in the Middle East. The company, which doesn't publish consolidated numbers on a quarterly basis, is currently trading at a P/E of 9.2. It can prove to be a good long-term investment given that it fills in key gaps in agro-chemicals segment.