SRF shares fall over 5% after company clarifies refrigerant gas price hike pertains to the US market

Shares of SRF Limited dropped over 5% today, reversing gains from the previous session, after the company issued a clarification regarding the recent price hike in refrigerant gases. SRF stated that the reported price hike by a US refrigerant gas distributor pertains specifically to the US market, and changes in gas prices will depend on demand and supply in that segment.

As of 9:15 am the shares were trading 5.49% lower at ₹2,527.05 on NSE.

Recent Developments

• Yesterday’s Surge: SRF shares had surged by 10%, hitting an upper circuit at ₹2,586, following reports of a significant price hike in refrigerant gases like R32 and R125. This was attributed to global supply constraints in the HVAC (Heating, Ventilation, and Air Conditioning) market.
• Market Speculation: The price hike news raised speculation of a positive impact on SRF’s earnings, which was subsequently tempered by the company’s clarification.

“In compliance with regulation 30(11) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company considers it necessary to clarify to the Stock Exchanges that the reported price hike by a US refrigerant gas distributor is in the context of the US market. Changes in prices of refrigerant gases for SRF will remain a function of demand and supply in our relevant market segment,” the company said in an exchange filing.

Key Highlights

1. Production Capacity:
   • SRF has a production capacity of 29,000-30,000 tons of R32 and 7,000 tons of R125.
   • These gases are critical components in the HVAC industry.
2. EBITDA Impact:
   • As per Equirus Securities, every $1/kg increase in R32 realization could boost SRF’s EBITDA by ₹2,600 crore.
   • Similarly, a $1/kg increase in R125 realization could add ₹600 crore to EBITDA.

Srf Share Price history