Gurugram, Haryana, Nov 04, 2020: SRF Limited, a chemical based multi-business conglomerate engaged in the manufacturing of industrial and specialty intermediates today announced its consolidated financial results for the second quarter and half year ended September 30, 2020. The company’s un-audited results were approved by the Board of Directors in a meeting held today via video conferencing.
Consolidated Q2FY21 Financials
The consolidated revenue of the company increased 21% from ₹1,738 crore to ₹2,101 crore in Q2FY21 when compared with Corresponding Period Last Year (CPLY). The company’s Earnings before Interest and Tax (EBIT) increased 66% from ₹290 crore to ₹480 crore in Q2FY21 when compared with CPLY. The company’s Profit after Tax (PAT) rose 57% from ₹201 crore to ₹316 crore in Q2FY21 when compared with CPLY. The overall EBIT margins expanded ~600 bps in Q2FY21 when compared with CPLY.
Commenting on the results, Managing Director, Ashish Bharat Ram said, “We have had an outstanding quarter by all standards led by our Packaging Films and Specialty Chemicals businesses. Going forward, the margins of the Packaging Films Business will soften. Having said that, I am confident that the momentum in our other businesses will ensure that we have a good year.”
Consolidated Q2FY21 Segment Results
The Chemicals Business reported an increase of 30% in its segment revenue from ₹678 crore to ₹881 crore during Q2FY21 over CPLY. The operating profit of the Chemicals Business rose 33% from ₹131 crore to ₹174 crore in Q2FY21 over CPLY. The Specialty Chemicals Business reported a robust performance on the back of higher capacity utilization of dedicated and multipurpose plants, which led to better operating leverages and the expansion of overall margins. Sales of the Fluorochemicals Business remained muted owing to weak demand for refrigerants from the automobile and air-conditioning segments and low prices of refrigerants globally.
The Packaging Films Business reported an increase of 26% in its segment revenue from ₹663 crore to ₹833 crore during Q2FY21 when compared with CPLY. The operating profit of the Packaging Films Business increased 89% from ₹130 crore to ₹246 crore in Q2FY21 over CPLY. The Packaging Films Business performed exceedingly well with expanded margins when compared with CPLY, and better capacity utilizations post the commissioning of BOPET film capacities in Thailand and Hungary. Further, the Business’ sustained focus on the sales of Value-Added Products contributed significantly to the overall performance.
The Technical Textiles Business reported an increase of 3% in its segment revenue from ₹323 crore to ₹332 crore during Q2FY21 over CPLY. The operating profit of the Technical Textiles Business increased 140% from ₹21 crore to ₹50 crore in Q2FY21 over CPLY. The Business delivered a healthy performance due to faster-than-expected recovery in the domestic tyre industry. Sales volume in the Nylon Tyre Cord Fabrics segment improved by ~25% when compared with CPLY.
The Other Businesses reported a decrease of 24% in its segment revenue from ₹74 crore to ₹57 crore during Q2FY21 when compared with CPLY. The operating profit of the Other Businesses improved marginally from ₹8 crore to ₹9 crore in Q2FY21 over CPLY. While the Business continued to maintain its domestic market leadership in both Coated and Laminated Fabrics, some of the products such as Tarpaulin witnessed a sharp decline in sales due to low commercial vehicle movement and no outdoor gatherings/events.
H1 FY21 Financials
In the first six months of FY21, the company’s PAT increased 31% from ₹376 crore to ₹493 crore over CPLY. SRF’s revenue increased 4% from ₹3,501 crore to ₹3,646 crore over CPLY.
Capex
The Board approved the setting up of a second BOPP film line in India at a site in Indore at an approximate cost of ₹424 crore.
The Board also approved the setting up of a dedicated facility to produce 200 MT per year of P16 specialty product at Dahej, India at an approximate cost of ₹17.5 crore.
In addition, the Board approved two projects related to future water security and set up of thermal oxidation facilities at the company’s chemicals complex at Dahej, India. These projects are aimed at minimizing the environmental impact of the chemicals business and ensuring the future sustainability of our Dahej site. These projects remain ROI accretive as we continue to deliver the benefits of more complex chemicals and specialty products to our global customers.
Innovation and Intellectual Property
As of September 30, 2020, the company has applied for a total of 294 patents. Till date, the company has been granted eighty patents globally.
Awards and Recognition
SRF’s Chemicals facility in Bhiwadi, Rajasthan was adjudged winner of the ‘ICC Award for Excellence in Management of Health & Safety’ for 2019 by the Indian Chemical Council.
