SRF Limited , a leading multi-business chemical conglomerate, has announced ambitious Return on Capital Employed (ROCE) targets for its key business segments during a recent conference call update. The company aims to achieve ROCE margins above 25% in its chemicals business, while setting a slightly lower target for its packaging films segment.

Chemicals Business Aims High

SRF has set its sights on achieving ROCE margins exceeding 25% in its chemicals business. This target underscores the company's confidence in the growth potential and profitability of its chemical operations, which include fluorochemicals and specialty chemicals.

Packaging Films Segment Target

For the packaging films segment, SRF has set a ROCE margin target that is 200 basis points lower than the chemicals business. This translates to a target of approximately 23% ROCE for the packaging films division, which includes products like BOPET (Bi-axially Oriented Polyethylene Terephthalate) and BOPP (Bi-axially Oriented Polypropylene) films.

Q1 FY26 Performance Highlights

The company recently released its Q1 FY26 results, which provide context for these ambitious targets:

The strong year-on-year growth in revenue, EBITDA, and profit after tax demonstrates SRF's robust performance, providing a solid foundation for its ambitious ROCE targets.

Segment-wise Performance

• Chemicals Business: Contributed 48.20% to total revenue and 72.40% to EBIT in Q1 FY26.
• Performance Films & Foil: Accounted for 37.10% of revenue and 20.20% of EBIT.
• Technical Textiles: Represented 12.20% of revenue and 5.40% of EBIT.

Strategic Focus

SRF's emphasis on high ROCE targets aligns with its strategic focus on value creation and efficient capital allocation. The company continues to invest in capacity expansion and new product development across its business segments to drive growth and profitability.

As SRF pursues these ambitious targets, investors and industry observers will be keenly watching the company's performance in the coming quarters. The ability to achieve and sustain high ROCE levels could significantly enhance SRF's competitive position in the chemical and packaging industries.

SRF Limited , a leading chemical-based multi-business entity, has expressed optimism for improved performance in the fiscal year 2026 (FY26) during its recent earnings call. The company anticipates stable to higher prices for hydrofluorocarbons (HFCs) throughout the fiscal year, which could potentially boost its Fluorochemicals business segment.

Chemical Division Growth Targets Maintained

Despite a strong performance in the first quarter, SRF has decided to maintain its original growth targets for the Chemical Division. This decision suggests a cautious yet confident approach to the company's core business segment.

PTFE Business Expansion

SRF has set an ambitious target for its polytetrafluoroethylene (PTFE) business, aiming to achieve 75-80% capacity utilization by the end of FY26. This goal indicates the company's focus on expanding its presence in the fluoropolymers market.

Q1 FY26 Financial Highlights

The company has released its unaudited financial results for the first quarter ended June 30, 2025:

The company has shown significant improvement in its financial performance compared to the same quarter in the previous fiscal year.

Segment-wise Performance

Chemicals Business

This segment reported a 24.10% year-on-year increase in revenue to Rs. 1838.90 crore, with EBIT margins expanding from 20.70% to 27.30%.

Performance Films & Foil Business

Revenue grew by 6.10% to Rs. 1418.20 crore, with EBIT margins improving from 6.50% to 9.90%.

Technical Textiles Business

This segment faced challenges with an 11.20% decline in revenue to Rs. 466.60 crore and EBIT margins contracting from 12.90% to 8.10%.

Future Outlook

SRF remains focused on maximizing HFC production and expects the refrigerant gas market to remain stable. The company is also optimistic about its PTFE business, anticipating positive developments in FY26.

For the Performance Films & Foil Business, SRF expects favorable demand-supply conditions in the domestic BOPP (Biaxially Oriented Polypropylene) market. The company's operations in Hungary are expected to perform better due to operational efficiencies.

In the Technical Textiles segment, SRF anticipates positive trends in Polyester Industrial Yarn and Polyester Tyre Cord Fabric sales.

With these strategic focuses and market expectations, SRF appears well-positioned to navigate the challenges and opportunities in the coming fiscal year.