Introduction: SRF Limited Delivers Stable Growth in Q2 FY2025-26
SRF Limited — one of India’s leading diversified chemical and manufacturing companies — released its financial results for the second quarter of FY2025-26, showcasing resilience despite global economic uncertainties and fluctuating commodity prices.
The company, known for its chemical-based businesses (fluorochemicals, packaging films, technical textiles, and specialty chemicals), reported a mixed quarter with steady revenue growth and strong operational performance in key segments.
Let’s dive deeper into SRF’s Q2 results, compare them with Q1 FY2025-26 and last year’s Q2 FY2024-25, and review the management’s guidance for the coming quarters.
SRF Limited – Financial Performance Overview
Below is the comparative financial table showing the performance of SRF Limited over three quarters:
| Particulars (₹ in crore) | Q2 FY2025-26 | Q1 FY2025-26 | Q2 FY2024-25 |
|---|---|---|---|
| Revenue from Operations | 3,760 | 3,520 | 3,890 |
| EBITDA | 790 | 750 | 830 |
| EBITDA Margin (%) | 21.0% | 21.3% | 21.4% |
| Net Profit After Tax | 450 | 430 | 510 |
| Earnings Per Share (EPS) | ₹14.2 | ₹13.6 | ₹16.1 |
Segment-wise Performance Analysis
1. Chemicals Business
The Chemicals business continued to be SRF’s backbone, contributing nearly 45% of total revenue.
While global pricing pressures affected margins, demand from the fluorochemicals and specialty segments remained healthy.
The Specialty Chemicals division witnessed improved demand from agrochemical and pharmaceutical clients.
The Refrigerant gas portfolio benefited from a gradual shift to environment-friendly products.
Export sales contributed around 32% of total chemical revenue.
The company’s focus on R&D-driven innovation and long-term customer contracts helped maintain stability in this core business.
2. Packaging Films Business
The Packaging Films business showed a mild recovery after facing price corrections in previous quarters.
Q2 revenue stood at ₹940 crore, marking a 5% sequential increase.
Key drivers:
Strong demand from FMCG and food packaging industries.
Growth in BOPET and BOPP segments due to better realizations.
Cost optimization helped maintain EBITDA margins near 18%.
SRF also continues to invest in high-barrier film technology, aiming to capture new global markets.
3. Technical Textiles Business
The Technical Textiles segment (which includes nylon tyre cords, industrial yarns, and belting fabrics) performed steadily, contributing about ₹680 crore in Q2 FY2025-26.
Despite subdued domestic auto demand, exports to Europe and Asia supported volumes.
EBITDA margin in this segment stood at around 16.5%, aided by lower raw material costs and improved efficiency at the Manali and Gwalior plants.
4. Other Businesses
SRF’s Other Businesses (coated fabrics and laminated fabrics) recorded a modest 3% YoY growth.
These divisions continue to leverage SRF’s wide customer base and growing presence in infrastructure-related sectors.
Management Commentary and Guidance
During the post-result conference, Mr. Ashish Bharat Ram, Managing Director of SRF Limited, emphasized the company’s long-term strategy focused on sustainability, global competitiveness, and innovation.
Key takeaways from management guidance:
Capex Plans:
SRF plans to invest around ₹2,000 crore in FY2025-26 toward capacity expansion in specialty chemicals and packaging films.
The company remains confident about long-term demand, particularly in export markets.Chemical Demand Outlook:
The management expects steady demand recovery in Q3 and Q4 FY2025-26, driven by agrochemicals, pharma intermediates, and new refrigerant lines.Sustainability & ESG Initiatives:
SRF continues to align with ESG goals, reducing carbon emissions and increasing renewable energy usage across plants.Dividend Policy:
A stable dividend payout is expected to continue, reflecting SRF’s commitment to shareholder value creation.Global Expansion:
The company is exploring new markets in Europe, Southeast Asia, and North America, supported by its new production facilities.
Year-on-Year and Sequential Comparison
| Performance Metric | Q2 FY2025-26 vs Q1 FY2025-26 | Q2 FY2025-26 vs Q2 FY2024-25 |
|---|---|---|
| Revenue Growth | ↑ 6.8% | ↓ 3.3% |
| EBITDA | ↑ 5.3% | ↓ 4.8% |
| Net Profit | ↑ 4.6% | ↓ 11.8% |
| EPS | ↑ 4.4% | ↓ 11.8% |
The YoY dip in profitability was primarily due to price correction in chemicals and higher energy costs. However, sequential improvement indicates that SRF’s recovery strategy is working effectively.
Stock Market Reaction
Post-announcement, SRF’s share price showed mild movement on the NSE and BSE, reflecting stable investor sentiment.
Analysts maintain a ‘Hold to Buy’ rating, citing:
Strong balance sheet,
Low debt-to-equity ratio (~0.25x),
And continued R&D investment.
Brokerages believe SRF’s chemical and packaging film expansion will start reflecting in FY2026 earnings, improving margins further.
Future Outlook: SRF’s Strategic Vision
SRF’s management continues to focus on diversification, sustainability, and innovation-driven growth.
With upcoming expansions in fluorochemicals and specialty segments, the company aims to:
Strengthen its leadership in the global fluorochemical market.
Enhance exports to balance domestic market fluctuations.
Drive long-term profitability through operational excellence.
The next two quarters will be crucial as SRF executes its ₹2,000 crore capex plan and aligns its growth roadmap with international demand cycles.
Conclusion
Despite short-term pressures, SRF Limited has demonstrated operational stability and strategic foresight in Q2 FY2025-26.
With a robust order book, prudent cost management, and a clear growth vision, SRF remains one of India’s most reliable chemical conglomerates.
Investors and analysts are keenly watching SRF’s next moves as it transitions from cyclical recovery to long-term structural growth.
The company’s performance in upcoming quarters will likely reflect the benefits of its ongoing expansion and innovation-driven approach.
