SRF shares climb 4% on Axis Capital upgrade despite target cut

Shares of SRF Ltd. are trading over 4% higher on Friday, November 28, after Axis Capital upgraded the stock to ‘Buy’ from its earlier ‘Add’ rating.

However, the brokerage has trimmed its price target to ₹3,330 from ₹3,410 per share.

In its note, Axis Capital said the company’s chemical business offers healthy medium-term growth potential and expects a 23% CAGR in this segment over FY25 to FY28.

The growth outlook is led by a 26% CAGR in specialty chemicals, led by the ramp-up of AIs and new molecules, along with an uptick in existing products. Pricing in this segment is expected to remain largely stable.

In the refrigerant gas business, the brokerage expects optimal utilisation of R32 capacity and a pricing-led uptick, aided by a quarter-on-quarter increase in China prices, which may support margins.

Axis Capital mentioned that the earnings recovery in the packaging films and technical textiles divisions may take more time.

It has cut its FY26 to FY28 EBITDA estimates by 3 to 7% to reflect weaker margins in the commodity business, although the rollover of the target price offsets the impact of these estimate cuts.

Shares of SRF Ltd. are trading 2.51% higher at ₹2,911.20. The stock has jumped 32% so far in 2025.