Neutral SRF; target of Rs 2250: Motilal Oswal

Motilal Oswal's research report on SRF

SRF reported subdued operating performance in 1QFY24 (EBIT declined 36% YoY), because of a broad-based deterioration in operating profitability across businesses. EBIT of Chemicals/Packaging/Technical Textile businesses dipped 12%/83%/48% YoY during the quarter. We reduce our FY24E/FY25E EBITDA by 20%/8%, due to the subdued demand scenario in Chemicals and Packaging businesses. We reiterate our Neutral rating owing to the stock’s expensive valuation, which has been priced into the near-term upside.

Outlook

We reduce our FY24E/FY25E EBITDA by 20%/8%, due to the subdued demand scenario in Chemicals and Packaging businesses. We reiterate our Neutral rating owing to the stock’s expensive valuation, which has been priced into the near term upside.