SRF Limited Remains Optimistic Amidst Weak Performance in FY24
#SRFFinancialReport #SRFProfits2024 #FinancialReport"While the general performance has been weak, we have seen a reasonable recovery in our Chemicals Business in the fourth quarter, as we had envisaged. We believe that this recovery will pick up pace in the second half of FY25."- Ashish Bharat Ram, Chairman and Managing Director, SRF Limited
May 2024 : SRF Limited recently announced its consolidated financial results for the fourth quarter of FY24 and the year ended on March 31, 2024. The company's audited results were approved by the Board of Directors.
The consolidated revenue of the company declined 6 percent from INR ₹3,778 crore to INR ₹3,570 crore in Q4FY24 when compared with the Corresponding Period Last Year (CPLY). The company's Earnings before Interest and Tax (EBIT) decreased 27 percent from INR ₹840 crore to INR ₹616 crore in Q4FY24 when compared with CPLY. The company's Profit after Tax (PAT) decreased 25 percent from INR ₹562 crore to INR ₹422 crore in Q4FY24 when compared with CPLY.
Commenting on the results, Ashish Bharat Ram, Chairman and Managing Director, SRF Limited, said, "While the general performance has been weak, we have seen a reasonable recovery in our Chemicals Business in the fourth quarter, as we had envisaged. We believe that this recovery will pick up pace in the second half of FY25."
The Chemicals Business reported a decline of 14 percent in its segment revenue from INR ₹2,102 crore to INR ₹1,816 crore during Q4FY24 over CPLY. The operating profit of the Chemicals Business decreased 33 percent from INR ₹739 crore to INR ₹498 crore in Q4FY24 over CPLY. During the quarter, the Specialty Chemicals Business continued to face headwinds due to inventory rationalization by certain key customers, while performing better than Q3FY24. In addition, a lot of capacity has come up in China, leading to pricing pressure on intermediate products.
The performance of the Fluorochemicals Business was adversely impacted owing to Chinese dumping of refrigerants in India and the international markets, leading to pricing pressure and some impact on volumes. In addition, sluggish growth in the agrochemical and pharmaceutical industries adversely impacted the demand for some key industrial chemicals. On the positive side, the Business continues to increase market share in the propellant vertical in both the domestic and international markets, entering new geographies and broadening the customer base.
The Packaging Films Business reported an increase of 3 percent in its segment revenue from ₹1,153 crore to INR ₹1,182 crore during Q4FY24 when compared with CPLY. The operating profit of the Packaging Films Business decreased INR 19 percent from INR ₹41 crore to INR ₹33 crore in Q4FY24 over CPLY. The Business faced strong headwinds with significant pressure on margins in Q4FY24. As stated earlier, this has been on account of several new lines getting operationalized in both BOPET and BOPP film segments in India and overseas. Moreover, we are witnessing severe competition from the Chinese players in the Southeast Asian markets.
However, the company is cautiously optimistic about the prospects of this Business in the medium-term as demand pivots towards global suppliers with multi-locational facilities.
The Technical Textiles Business reported an increase of 9 percent in its segment revenue from INR ₹431 crore to INR ₹469 crore during Q4FY24 over CPLY. The operating profit of the Technical Textiles Business increased 44 percent from INR ₹48 crore to INR ₹70 crore in Q4FY24 over CPLY. During the quarter, the Business witnessed volume growth in the Nylon Tyre Cord Fabrics and the Polyester Industrial Yarn segments. The Business continues to focus on improving the sales of high-end, Value-Added Products, mostly in the Belting Fabrics segment.
The Other Businesses reported an increase of 13 percent in its segment revenue from INR ₹94 crore to INR ₹106 crore in Q4FY24 when compared with CPLY. The operating profit of the Other Businesses increased 37 percent from INR ₹11 crore to INR ₹16 crore in Q4FY24 over CPLY. Domestic demand for Coated Fabrics remained strong as the Business reported its highest-ever sales during the quarter. In the Laminated Fabrics Business, SRF continued to maintain its price leadership by selling full capacity.
In FY24, SRF's revenue decreased 12 percent from INR ₹14,870 crore to INR ₹13,139 crore over CPLY. The company's EBIT decreased 31 percent from INR ₹3,193 crore to INR ₹2,201 crore over CPLY. The company's PAT decreased 38 percent from INR ₹2,162 crore to INR ₹1,336 crore over CPLY.
NEWSLETTER
TRENDING ON PRO MFG
MORE FROM THE SECTION
