{"id":158254,"date":"2024-02-01T06:26:14","date_gmt":"2024-02-01T11:26:14","guid":{"rendered":"https:\/\/44.250.171.167\/?p=158254"},"modified":"2024-02-01T06:26:16","modified_gmt":"2024-02-01T11:26:16","slug":"srf-limited-q3-fy24-earnings-conference-call-insights","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/srf-limited-q3-fy24-earnings-conference-call-insights\/","title":{"rendered":"SRF Limited Q3 FY24 Earnings Conference Call Insights"},"content":{"rendered":"<p><strong>Key highlights from SRF Limited (SRF) Q3 FY24 Earnings Concall<\/strong><\/p>\n<ul>\n<li><strong>Financial Performance<\/strong>\n<ul>\n<li>Revenues down 12% YoY to INR 3,053 crores.<\/li>\n<li>EBIT down 37% YoY to INR 457 crores.<\/li>\n<li>PAT down 50% YoY to INR 253 crores.<\/li>\n<li>Weakness in chemicals and packaging films segments.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Outlook<\/strong>\n<ul>\n<li>Expect significant growth recovery in Q4.<\/li>\n<li>End markets poised to rebound.<\/li>\n<li>Well placed to deliver sustained performance.<\/li>\n<li>Specialty chemicals affected by inventory rationalization; expect recovery in Q4 as situation improves.<\/li>\n<li>New products and facilities to drive growth.<\/li>\n<li>Gases business impacted by lower volumes and realizations.<\/li>\n<li>Pricing expected to be more rational going forward.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Capex and Investments<\/strong>\n<ul>\n<li>INR 1,800 crores capex in 9M FY24.<\/li>\n<li>Additional INR 700 crores planned in Q4.<\/li>\n<li>Some delays seen in project timelines due to external factors.<\/li>\n<li>Execution much better than peers; already seeing positive impact of some projects.<\/li>\n<li>Confident of ramp-up continuing over next 12-18 months based on demand outlook.<\/li>\n<li>INR 1,100 crores of approved multi-year capex to be incurred over FY25 and FY26.<\/li>\n<li>Expect FY25 capex around INR 2,000-2,200 crores with 80% focused on chemicals segment.<\/li>\n<li>Long-term guidance of INR 15,000 crores over 5-6 years remains intact.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Agrochemicals Project Outlook<\/strong>\n<ul>\n<li>INR 1,100 crores capitalized in 9M FY24.<\/li>\n<li>Additional INR 700 crores in Q4.<\/li>\n<li>Ramp up across new molecules underway.<\/li>\n<li>Traction visible, expect momentum in Q4.<\/li>\n<li>Full year guidance after budgeting exercise.<\/li>\n<\/ul>\n<\/li>\n<li><strong>PTFE and Aluminum Projects<\/strong>\n<ul>\n<li>PTFE capitalized in Oct 2022, approvals underway.<\/li>\n<li>6-12 months for PTFE ramp up.<\/li>\n<li>Aluminum awaiting global approvals.<\/li>\n<li>Initial ramp up in 6 months, full in 12-18 months.<\/li>\n<li>Operating leverage to play out over 1-2 years.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Packaging Films Business<\/strong>\n<ul>\n<li>Difficult business environment persists.<\/li>\n<li>Pricing pressure and lower utilization continued.<\/li>\n<li>Sequential decline due to seasonal factors.<\/li>\n<li>Some cost benefits on annualized basis.<\/li>\n<li>Capacity utilization was around 90-91% in Q3.<\/li>\n<li>Indicates healthy demand and operating rates for the business.<\/li>\n<li>BOPET oversupply to persist for next 12 months, limiting margin expansion.<\/li>\n<li>New BOPP capacities may also pressure margins despite demand growth.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Specialty Chemicals<\/strong>\n<ul>\n<li>Revenue declined around 10-11% in the first 9 months of the year vs prior year.<\/li>\n<li>Still hopeful of achieving single-digit revenue growth target for FY24.<\/li>\n<li>Actively looking for alternative products and customer positions.<\/li>\n<li>Remain very positive on growth recovery potential for specialty chemicals in Q4.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Fluorochemicals Business<\/strong>\n<ul>\n<li>Seeing some demand weakness in certain agrochemical applications.<\/li>\n<li>Pricing has moderated from peak levels seen in FY22 for some refrigerant gases.<\/li>\n<li>But long-term demand outlook remains strong given rebound in US\/Europe and growth in India\/SE Asia.<\/li>\n<\/ul>\n<\/li>\n<li><strong>China Competition<\/strong>\n<ul>\n<li>Seeing aggressive pricing in refrigerant gases as China looks to liquidate excess inventory.<\/li>\n<li>Cost competitiveness remains strong; issue is China pricing below variable costs.<\/li>\n<li>Most competition in subsets where capacities\/inventories have built up in China.<\/li>\n<\/ul>\n<\/li>\n<li><strong>New Product Traction<\/strong>\n<ul>\n<li>Launched 15 new agrochemical products, 2 more planned in Q4.<\/li>\n<li>New products seeing less competition from China currently.<\/li>\n<li>Starting to see orders\/revenue contribution; key growth driver.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Domestic Refrigerant Gas Outlook<\/strong>\n<ul>\n<li>Q1 strongest quarter domestically given seasonal demand.<\/li>\n<li>Market set to grow in medium term driven by increasing refrigeration needs.<\/li>\n<li>Well positioned given limited competition in domestic HFC space.<\/li>\n<li>35-40 stores have achieved ROI showing profitable model.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Pharma Segment Traction<\/strong>\n<ul>\n<li>Currently small contributor to specialty chemicals revenue.<\/li>\n<li>Seeing positive momentum; growth contribution expected in mediium term.<\/li>\n<li>Agrochem remains largest segment currently.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Key highlights from SRF Limited (SRF) Q3 FY24 Earnings Concall Financial Performance Revenues down 12% YoY to INR 3,053 crores. EBIT down 37% YoY to INR 457 crores. PAT down 50% YoY to INR 253 crores. Weakness in chemicals and packaging films segments. Outlook Expect significant growth recovery in Q4. End markets poised to rebound. [&hellip;]<\/p>\n","protected":false},"author":1767,"featured_media":154818,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[9825,392,5753],"tags":[8519,10169],"class_list":["post-158254","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-call-highlights","category-earnings","category-industrials","tag-chemicals","tag-earnings"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":161429,"url":"https:\/\/alphastreet.com\/india\/tracxn-technologies-ltd-q4-fy24-earnings-conference-call-insights\/","url_meta":{"origin":158254,"position":0},"title":"Tracxn Technologies Ltd Q4 FY24 Earnings Conference Call Insights","author":"Praveen","date":"May 21, 2024","format":false,"excerpt":"Key highlights from Tracxn Technologies Ltd (TRACXN) Q4 FY24 Earnings Concall Financials Q4 FY24 revenue from operations: INR 20.3 crores. 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