SRF Limited, a chemical based multi-business entity engaged in the manufacturing of industrial and specialty intermediates, announced its consolidated financial results for the fourth quarter and year ended March 31, 2024.

The consolidated revenue of the company declined 6% from Rs. 3,778 crore to Rs. 3,570 crore in Q4 FY24 when compared with Corresponding Period Last Year (CPLY). The company's Earnings before Interest and Tax (EBIT) decreased 27% from Rs. 840 crore to Rs. 616 crore in Q4 FY24 when compared with CPLY. The company's Profit after Tax (PAT) decreased 25% from Rs. 562 crore to Rs. 422 crore in Q4 FY24 when compared with CPLY.

Commenting on the results, Chairman and Managing Director, Ashish Bharat Ram 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."

Consolidated Q4FY24 Segment Results

The Chemicals Business reported a decline of 14% in its segment revenue from Rs. 2,102 crore to Rs. 1,816 crore during Q4 FY24 over CPLY. The operating profit of the Chemicals Business decreased 33% from Rs. 739 crore to Rs. 498 crore in Q4 FY24 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 Q3 FY24. 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 Dymel/ propellant vertical in both the domestic and international markets, entering new geographies and broadening customer base.

The Packaging Films Business reported an increase of 3% in its segment revenue from Rs. 1,153 crore to Rs. 1,182 crore during Q4 FY24 when compared with CPLY. The operating profit of the Packaging Films Business decreased 19% from Rs. 41 crore to Rs. 33 crore in Q4 FY24 over CPLY. The Business faced strong headwinds with significant pressure on margins in Q4 FY24. 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, we believe, as demand pivots towards global suppliers with multi-locational facilities, we remain cautiously optimistic about the prospects of this Business in the medium-term.

The Technical Textiles Business reported an increase of 9% in its segment revenue from Rs. 431 crore to Rs. 469 crore during Q4 FY24 over CPLY. The operating profit of the Technical Textiles Business increased 44% from Rs. 48 crore to Rs. 70 crore in Q4 FY24 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% in its segment revenue from Rs. 94 crore to Rs. 106 crore in Q4FY24 when compared with CPLY. The operating profit of the Other Businesses increased 37% from Rs. 11 crore to Rs. 16 crore in Q4 FY24 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.

Consolidated Annual Results

In FY24, SRF's revenue decreased 12% from Rs. 14,870 crore to Rs. 13,139 crore over CPLY. The company's EBIT decreased 31% from Rs. 3,193 crore to Rs. 2,201 crore over CPLY. The company's PAT decreased 38% from Rs. 2,162 crore to Rs. 1,336 crore over CPLY.

Innovation and Intellectual Property

As of March 31, 2024, the company has applied for 443 patents, with thirteen patents applied during the quarter. Till date, the company has been granted one-hundred and forty-nine patents globally.