SRF Q4 Review - FY22E Growth Capped On Higher Plants Utilisation: ICICI Securities
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ICICI Securities Report
SRF Ltd.’s chemical business revenues and Ebit came above estimates in Q4 FY21, and performance in other businesses were equally strong.
Specialty chemical revenue rose 43% YoY in FY21 (guidance: more than 25%) was strong, but flattish ref-gas revenues disappointed.
The company has guided for 10-15% growth in specialty chemicals in FY22 on large base while its fresh capex may show result only in FY23E.
But, FY22E can see expansion in margins on operating leverage, but FY23E may see pressure on the same due to large planned launches.
The company remains aggressive on capex in specialty chemicals and it has been strongly rewarded with growth, which may continue in the medium term too.
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