SRF revenue jumps 35% to 4,904 crore rupees in second quarter
Key Facts
SRF Ltd. reported a 35% increase in consolidated revenue to 4,904 crore rupees in the second quarter of fiscal 2027, ended September 30, 2026, compared with 3,640 crore rupees a year earlier. Profit after tax rose 31% to 509 crore rupees from 388 crore rupees. Operating profit before interest and tax increased 26% to 816 crore rupees, from 650 crore rupees in the year-earlier period. The results show growth in revenue and profit, while performance varied across segments. The company said consolidated revenue in the first half of the fiscal year reached 9,937 crore rupees, up 33%, while profit after tax rose 55% to 1,268 crore rupees.
In the chemicals business, second-quarter revenue rose 25% to 2,079 crore rupees, while operating profit increased 10% to 528 crore rupees. SRF said its refrigerants business benefited from strong sales volumes and positive pricing momentum. Specialty chemicals, by contrast, faced excess capacity in China and shifting global pricing trends. The difference between revenue and operating profit growth in the chemicals segment highlights the quarter's performance equation, as operating profit growth did not keep pace with revenue. According to the company, strong first-half performance came largely in the context of its guidance for revenue growth in the chemicals business for the fiscal year.
In the films and foil business, revenue rose 51% to 2,122 crore rupees, while operating profit climbed 73% to 206 crore rupees. The segment therefore recorded operating profit growth faster than revenue growth during the quarter. At the company level, operating profit before interest and tax growth was lower than consolidated revenue growth, reaching 816 crore rupees. Segment figures show different sources of momentum across the group: strong expansion in films and foil, against slower operating profit growth in chemicals. The results reported in these figures provide no further breakdown of the factors behind growth in the films and foil segment.
Management said it expects revenue in the chemicals business to approach the upper end of its annual growth range of 15% to 20% in fiscal 2027, following strong first-half performance. That remains fiscal-year guidance, not a realized result. At the same time, management said raw material costs had risen across segments because of higher crude oil prices and the continued war in West Asia. It added that the company is passing cost increases on to customers, but the margin outlook for the second half of fiscal 2027 remains uncertain. Management also said the timing and extent of a recovery in operating profit and margins in specialty chemicals are unclear, despite expectations that revenue will improve as volumes recover.
The company approved an investment of up to 600 crore rupees to establish an Indian facility for battery-grade aluminum foil, with capacity of about 12,000 tonnes a year. The project will be implemented in two phases, at an estimated cost of 300 crore rupees for each phase. SRF aims to complete the first phase by September 2028 and the second by September 2030. The target completion dates extend beyond the current fiscal year, making the project part of the company's future capacity plans. The investment comes alongside quarterly results showing higher revenue and profit, while management maintained its uncertainty over second-half margins.
The stock moved in different directions in two consecutive sessions after the results were announced. On October 21, SRF shares closed down 5.22% at 2,305 rupees on the NSE, compared with a 0.34% decline in the Nifty in the same session. On October 22 at 14:27 India time, the stock traded at 2,358.90 rupees, up 2.3% from Wednesday's close. These figures reflect the stock's recorded moves over the two sessions, while management continued to warn of cost pressures. The upcoming project milestones remain set for September 2028 and September 2030.