SRF Ltd. delivered impressive fourth-quarter results that exceeded analyst expectations, with consolidated net profit rising 11% year-on-year to ₹582 crore, surpassing the poll estimate of ₹563 crore. According to latest reports from Informist Media, consolidated revenue grew 7% YoY to ₹4,615 crore, ahead of the poll estimate of ₹4,306 crore. Consolidated operational earnings before interest and tax increased 12% on year to ₹1,011 crore, while EBITDA margins remained largely stable at 22.2%, slightly below expectations of 22.6%. The company's gains from fluctuations in foreign exchange markets surged nearly threefold to ₹1.26 billion from ₹451.2 million, benefiting from rupee depreciation. For the full fiscal year 2026, SRF's consolidated revenue rose 7% to ₹15,787 crore from ₹14,693 crore, while consolidated net profit came in at ₹1,835 crore, up 47% from FY25.
The standout performance was driven by the refrigerant gases (refgas) segment, where both export volumes and realisations saw a sharp uptick, as reported by CNBC TV18. The technical textiles business posted a sharp recovery with EBIT rising 63% YoY and 45% sequentially to ₹65 crore. The chemicals segment delivered steady growth with EBIT growing 5% YoY and 58% QoQ to ₹782 crore, while the packaging films segment showed strong momentum with EBIT up 47% YoY and 62% QoQ at ₹154 crore. According to Informist Media, the chemicals business recorded 5% year-on-year growth in operating profit at ₹7.83 billion, while the packaging division reported a substantial 47% on-year surge to ₹1.54 billion. The Performance Films & Foil Business showcased significant momentum with a 13% revenue increase to ₹1,596 crore and an impressive 47% jump in operating profit.
SRF has significantly increased its capital expenditure commitment, approving a ₹2,300 crore investment, up from ₹1,100 crore announced in October 2024, to establish a 20 ktpa HFO plant along with a new 30 ktpa HF facility and downstream value-added derivatives, according to CNBC TV18 reports. The project will be executed in phases and is expected to be completed by February 2028. Additionally, the company will invest ₹88 crore towards a brownfield expansion to increase HFC capacity by 12.5 ktpa. However, the company has indefinitely deferred plans to set up a manufacturing unit for biaxially oriented polypropylene in Indore, which had factored in a capital outlay of ₹4.90 billion. The company has also decided to indefinitely defer its proposed ₹490 crore BOPP Film manufacturing facility in Indore due to changing market conditions. In a separate development, an expansion of existing HFC capacity at Dahej, costing ₹88 crore, is expected to commence production in June 2026.
SRF faces several operational challenges including ongoing concerns over a "volatile environment" and "prevailing geopolitical uncertainty" as highlighted by the company's Chairman. The company noted an impact on Middle East exports during Q4 FY26, reflecting potential geographical market sensitivities. SRF also faces substantial tax demands, including ₹327.44 crore for income tax (AY 2022-23), ₹38.49 crore for customs duty, and a ₹4.20 crore anti-dumping duty order, all of which SRF is contesting. The company operates in competitive markets with key rivals including Gujarat Fluorochemicals Ltd. and Navin Fluorine International Ltd. These strategic shifts mean shareholders can expect increased capital allocation toward the Refrigerants segment, while the deferral of the Indore BOPP facility indicates a potential strategic pivot possibly due to evolving market conditions or project feasibility reassessments.
