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Informist, Wednesday, May 6, 2026

 

--SRF: Company's sales in West Asia in Q4 impacted by conflict

--CONTEXT: Comments by SRF management in post-earnings analyst call

--SRF:Continued pricing competition from China weighed on specialty chemicals

--SRF: FY27 capex plan at INR 25 billion

--SRF: Some disruption in raw material supply in films, foil ops

--SRF: Expect recent uptake in refrigerant gas to hold

 

By Rajesh Gajra and Ruchira Kagita

 

MUMBAI – SRF Ltd.'s sales in West Asia were impacted during the March quarter due to the ongoing war in the region, the company's management said in a post-earnings call with investors and analysts. The company has traditionally had a strong presence in the West Asia region, Chairman and Managing Director Ashish Bharat Ram said in the call. The company is getting into new markets as a de-risking strategy, he said.

 

"The global operating environment remains defined by volatility, uncertainty, and complexity. Compared to this time last year, conditions have not materially improved. If anything, they have become more challenging," the official said. The situation in West Asia has continued to disrupt global trade flows and supply chains, he said. "As a company operating in chemical intermediates, we have felt the impact of these disruptions across logistics, supply chains, and market access," he said.

 

SRF saw "some disruption in terms of ability to sell refrigerant gas into the Middle East (West Asia)" for about half the March quarter, a senior official said. The margin for the chemicals segment was not impacted beyond the impact on refrigerant gas sales in that region, he said.  

 

Raw materials supply chain was also impacted in the March quarter due to the West Asia situation, but a team in the company "scrambled really quickly and early, as soon as the first indicators appeared, to ensure that we had alternate supply chains in place," the official said. The company had a stand-out earnings performance in the March quarter "despite all the disruptions we have seen," he said. Raw material disruption was most visible in the performance films and foils business of the company, the official said.

 

On the performance of the specialty chemicals sub-segment in the chemicals business for 2025-26 (Apr-Mar), a company official said pricing pressure was seen across the value chain, with aggressive participation from Chinese players impacting the company's markets and the customers' end markets. Going forward, a strong product pipeline in specialty chemicals will be critical to face the tough times. "We are in a place where we can continue to compete in the (specialty chemicals) market and ensure we sustain volumes at effective margins," the official said.  

 

There was a significant improvement in refrigerant gas sales in the March quarter as compared to the December quarter, the management said. The company expects the uptick to hold in the June quarter. The company is debottlenecking hydrofluorocarbon units at scale currently, an official said. "So, there are volumes that we are seeing that we can go fulfill," he said. On the overall chemicals segment, the official said that while the operating environment remains volatile "the company should be able to deliver growth in the range of 15-20%" in FY27.

 

On capital expenditure, the official said the target for FY27 has been set at about INR 25 billion. On the chemicals segment capex, the official said new investments "in fourth-generation gases and specialty fluoropolymers will shape the position the fluorochemicals business will sustain and further accelerate its strong growth trajectory."

 

SRF's earnings for the March quarter beat analysts' expectations as its consolidated net profit rose almost 11% on year to INR 5.82 billion and its revenue for the period was up 7% year-on-year at INR 46.15 billion. At 1407 IST, shares of SRF traded almost 9% higher at over a two-month high of INR 2,742.50 on the National Stock Exchange.  End

 

Edited by Vandana Hingorani

 

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