Archive · 23 Aug 2025
SRF: Valuations High Despite Growth Prospects
SRF, a company making chemicals and films, is doing okay, but its stock price is high because everyone expects it to grow a lot.
The chemicals part is getting better after some slow times, especially with new products and facilities.
The film business has problems with too much supply but also some positive developments.
The part that makes fabrics for things like belts isn't doing so well.
The company is investing to grow, and experts are watching closely to see if SRF can meet the high expectations that are built into the stock price.
SRF shares have seen a modest 15% return, but are trading at a premium.
The chemicals segment is recovering from inventory destocking.
Fluorochemicals face a balanced outlook, with refrigerant gases under quota.
Performance film faces cyclical overcapacity, but a domestic fire accident and anti-dumping duties may help.
Technical textiles face weak demand and competition, impacting margins.
- Who
- SRF, an Indian company in the chemical and film industries.
- What
- Analysis of SRF's performance, growth prospects, and valuation.
- When
- The analysis covers recent performance and future expectations, with a focus on FY26 and FY27.
- Where
- The company has operations in India and international markets.
- Why
- To assess investment risk and reward based on market expectations.
Investors
Analysts
Investment strategy
Investors
Long-term investors can hold the stock.
Analysts
New investors should wait for better entry points.
- Stock Return (approx.)
- 15%
- FY26/FY27 Earnings Growth (expected)
- 57%/29% (year on year)
- Chemicals Segment Composition (FY25)
- Speciality (58%), Fluorochemicals (42%)
- Capex in FY26
- ₹2,500 crore
- EBITDA Margin Improvement (Q1 FY26)
- 430 bps year on year
- Debt to EBITDA
- 1.2 times