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Motilal Oswal has neutral call on with a target price of Rs 6336. The current market price of SRF Ltd. is Rs 6450.
SRF Ltd., incorporated in the year 1970, is a Large Cap company (having a market cap of Rs 38509.98 Crore) operating in Diversified sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 2620.61 Crore, up 20.87 % from last quarter Total Income of Rs 2168.09 Crore and up 40.58 % from last year same quarter Total Income of Rs 1864.15 Crore. Company reported net profit after tax of Rs 380.92 Crore in latest quarter.
Investment Rationale
The earnings momentum is likely to slow, largely due to a) margin contraction in the Packaging segment (EBIT margin of 27.3% in FY21 v/s 21% for FY22 & FY23) and b) reduced growth momentum in Specialty Chemicals on a high base (threeyear revenue CAGR of 60% v/s 24% over FY21–23). Going forward, the brokerage expects SRF to post a revenue/EBITDA/PAT CAGR of 22%/17%/21% over FY21–23E.
Promoter/FII Holdings
Promoters held 50.8 per cent stake in the company as of March 31, 2021, while FIIs held 18.4 per cent, DIIs 11.2 per cent and public and others 19.6 per cent.
SRF Ltd., incorporated in the year 1970, is a Large Cap company (having a market cap of Rs 38509.98 Crore) operating in Diversified sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 2620.61 Crore, up 20.87 % from last quarter Total Income of Rs 2168.09 Crore and up 40.58 % from last year same quarter Total Income of Rs 1864.15 Crore. Company reported net profit after tax of Rs 380.92 Crore in latest quarter.
Investment Rationale
The earnings momentum is likely to slow, largely due to a) margin contraction in the Packaging segment (EBIT margin of 27.3% in FY21 v/s 21% for FY22 & FY23) and b) reduced growth momentum in Specialty Chemicals on a high base (threeyear revenue CAGR of 60% v/s 24% over FY21–23). Going forward, the brokerage expects SRF to post a revenue/EBITDA/PAT CAGR of 22%/17%/21% over FY21–23E.
Promoter/FII Holdings
Promoters held 50.8 per cent stake in the company as of March 31, 2021, while FIIs held 18.4 per cent, DIIs 11.2 per cent and public and others 19.6 per cent.
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