Jefferies has reiterated its bullish view on Supreme Industries (SI) with a ‘Buy’ rating and a raised target price of ₹5,150, citing strong volume recovery, margin improvement, and favorable product mix trends.
The brokerage noted that SI’s volume growth rebounded to 10% year-on-year in April-May 2025, compared to the muted 2-3% growth in the second half of FY25. The revival is attributed to channel restocking and a steep correction in PVC prices, which are now near 15-year lows. Additionally, sales from value-added segments (VAS) grew 12% YoY, signaling strong underlying demand and improved product mix.
A significant development during the quarter was the receipt of a ₹540 million order from BPCL for composite LPG cylinders, which will be fulfilled over the next six months. This not only diversifies revenue streams but also demonstrates Supreme’s growing presence in high-spec applications.
The company’s pipe segment is also set for capacity expansion, with FY26 expected to see an addition of 70,000 MT, taking total capacity to 940,000 MT.
“With robust exposure to end markets such as housing, infrastructure capex, and agriculture, Supreme Industries is well-positioned to benefit from India’s ongoing economic transformation. We estimate a strong 23% earnings CAGR over FY25-28,” Jefferies noted.
