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Informist, Thursday, Jul. 23, 2026

--SRF: Demand trends uneven in Q1 amid geopolitical volatility 
--CONTEXT: Comments by SRF's management in post-earnings investor call 
--SRF: Co's focus in technical textiles is on expanding volumes 
--SRF: Global operating environment remains uncertain 

--SRF: Specialty chem capacity sufficient for expansion next 2 yrs in Dahej 

--SRF: Panic buying by some clients contributed to price increases in Q1 

--SRF: Volumes are lower in pharma chemicals at this point in time 

--SRF: Focus in aluminium foil business more export oriented now vs past 

--SRF: Not thinking of aluminium foil capacity expansion currently 

--SRF: See some price corrections in Q2 vs exceptionally strong Q1 

--SRF:Aim to derisk packaging film business from polyester price cyclicality 

 

By Gunjan Rajput and Rajesh Gajra

 

NEW DELHI – SRF Ltd. expects to see price corrections in the September quarter, compared to an exceptionally strong June quarter, as the global operating environment remains uncertain and demand trends stay uneven due to geopolitical volatility, the management said in a post-earnings analyst conference call on Thursday. 

 

"It is important, though, to recognise that SRF business, especially the chemicals business, is highly seasonal in nature, and as has been the case in the past, we will see lower numbers in Q2 as compared to Q1," the management said. It also added that the strong June quarter was driven by a diversified portfolio, strong balance sheet, and disciplined execution by the company. 

 

On the unique circumstances of the June quarter, a senior official said, "The rest of the world were shutting plants (and) capacities were going off stream," but SRF was operating at 100?pacity. This contributed significantly to the robust operational performance of the company during the reporting quarter.

 

There was also "a lot of panic buying by a bunch of customers at that point in time," the official said. Prices during the quarter "had significantly improved because of panic buying," he said. But this is expected to normalise in the September quarter, and hit quarter-on-quarter growth, he said. But on a year-on-year basis, there would be growth in volumes and revenue, according to the management.

 

On its various segments, the management said the company's focus in technical textiles is on expanding volumes and operational efficiencies. The company's outlook on this segment is positive, particularly following the rationalisation of tariffs for certain products.

 

To a question on the readiness of the company in terms of creating assets required to launch the six-seven new active ingredient products the company is aiming at, the management said production capacity is not a constraint for the company but it is waiting for the products to get registered and launched by innovators.

 

A senior official said that the company's specialty chemicals capacity at the Dahej facility, Gujarat, is sufficient to support expansion over the next two years. "There is still space specifically for speciality, there are structures that are available...expand and grow all that they need for this next 24-month period...there is adequate space specifically for speciality," he said.

 

On pharma chemicals, the management said the volumes are currently lower. In the aluminium foil business, the official said the company had shifted its focus to expand the contribution of export sales. "We are pretty much right now more focused on where product goes out to in terms of markets," he said. To a question on whether the aluminium foil capacity would be expanded in the near term, the official said there were no plans at present.

 

In the films segment, the broader strategy currently "is really to go and de-risk ourselves from the volatility of consumer pricing," he said. All steps, including the new capital expenditure the board approved Wednesday, are in that direction, he said.

 

SRF's consolidated net profit surged nearly 76% on year to INR 7.59 billion in Apr-Jun, while its revenue rose nearly 32% on year to INR 50.33 billion. At 1331, shares of SRF were at INR 2,648, down 7.7% from Wednesday on the National Stock Exchange.  End

 

Edited by Avishek Dutta

 

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