Buy SRF, target price Rs 3065: ICICI Direct

ICICI Direct has buy call on SRF with a target price of Rs 3065. The current market price of SRF is Rs 2633.3.
Time period given by analyst is one year when SRF Ltd. price can reach defined target.

SRF Ltd., incorporated in the year 1970, is a Large Cap company (having a market cap of Rs 77699.36 Crore) operating in Diversified sector.


SRF Ltd. key Products/Revenue Segments include Chemicals (Industrial), Packaging Film, Textiles, Others for the year ending 31-Mar-2021.


Financials
For the quarter ended 31-12-2021, the company reported a Consolidated Total Income of Rs 3356.54 Crore, up 17.77 % from last quarter Total Income of Rs 2850.09 Crore and up 54.82 % from last year same quarter Total Income of Rs 2168.09 Crore. Company reported net profit after tax of Rs 505.54 Crore in latest quarter.

Investment Rationale
SRF’s share price has grown at 76% CAGR over the past three years. With sustained visibility capex (Rs 6000 crore in FY16-21 and another Rs 6000 crore earmarked in FY21-24E) it believes the company is well poised to expand into newer and more complex areas (such fluoro-chemicals) by leveraging on its strong pedigree.

Promoter/FII Holdings
Promoters held 50.73 per cent stake in the company as of 31-Dec-2021, while FIIs owned 19.09 per cent, DIIs 9.16 per cent.