Synopsis: Shares of this specialty chemicals firm continued to be in the spotlight following a repeat of a favorable recommendation by an analyst based on a comprehensive turnaround of the firm’s operations and better-than-anticipated quarterly results.
The shares of this large-cap company majorly engaged in manufacturing and selling technical textiles, chemicals, packaging films, aluminum foils, and other polymers, were in focus after the brokerage sees upto 25 percent upside potential.
With the market capitalization of Rs. 79,442 Crores, the shares of SRF Ltd were trading at around Rs. 2680 per share which is 17 percent discount from its 52 week high of Rs. 3239 per share and is trading at a P/E of 35.4 whereas industry P/E stands at 22.8
Q1 FY27 Result
- YoY analysis: Revenue from operations has increased from Rs. 3819 Crores in Q1 FY26 to Rs. 5033 Crores, in Q1 FY27, up 31 percent. Operating profit has increased from Rs. 830 Crores to Rs. 1,237 Crores, up 49 percent and net profit has increased from Rs. 432 Crores to Rs. 759 Crores, up 75 percent.
- QoQ analysis: Revenue from operations has increased from Rs. 4615 Crores in Q4 FY26 to Rs. 5033 Crores in Q1 FY27, up 9 percent. Operating profit has increased from Rs. 1026 Crores to Rs. 1237 Crores, up 20 percent and net profit has increased from Rs. 582 Crores to Rs. 759 Crores, up 30 percent.
HSBC’s View on SRF Chemicals
HSBC has reiterated its ‘Buy’ rating on SRF with a target price of Rs 3,300, implying an upside potential of around 23 percent from the current market price. The brokerage turned more optimistic after the company reported stronger-than-expected Q1 FY27 earnings, with all business segments surpassing estimates.
HSBC believes the recovery is now broad-based, and expects improving demand in the specialty chemicals business to act as a key growth catalyst, supporting earnings momentum and further re-rating potential.
About the company
SRF Limited is a diversified manufacturing company having operations worldwide, as they export their goods to more than 90 countries and have manufacturing facilities in 5 countries. SRF Limited has more than 9,500 employees in their 16 manufacturing factories.
The main revenue generator, Chemicals, earned a revenue of Rs. 7,779 crore and EBIT of Rs. 2,263 crore through 2 manufacturing plants that provide specialty chemicals and fluorochemicals, including refrigerants and fluoropolymers. The Performance Films & Foil business segment contributed Rs. 5,764 crore of revenue, Rs. 508 crore EBIT, through 8 manufacturing plants that produced flexible packaging films such as BOPET, BOPP, and Aluminium Foil. Technical Textiles (4 plants) provided a revenue of Rs. 1,877 crore, whereas the Others segment (2 plants) earned Rs. 366 crore through coated and laminated fabrics.
Total revenue for Q1 FY27 stood at Rs. 5,033.3 crore. The CB segment was the top-performing segment, contributing Rs. 2,314.9 crore to total revenue (46.0 percent of total revenue). The PFB segment contributed Rs. 2,016.7 crore (40.1 percent ), while the TTB segment contributed Rs. 596.8 crore (11.8 percent ) and other business segments added Rs. 104.9 crore (2.1)
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