IIFL Research's Pick: Buy Srf with Target ₹ 2520

IIFL Research has buy call on Srf at current market price of Rs 2454. The target price of Srf is Rs 2520.

About Srf:

SRF (formerly Shriram Fibres) is a diversified Indian multinational conglomerate based in Gurgaon, Haryana, India. The company is primarily engaged in the manufacturing of industrial and specialty chemicals, including fluorochemicals, performance polymers, advanced intermediates, and packaging films. SRF also has operations in renewable energy, engineering plastics, and technical textiles. The company has a global presence with manufacturing facilities across India, Europe, the Middle East, and the Americas.

52 Week Price Trend:

SRF Limited's (SRF) stock has experienced significant fluctuations over the past year. Its 52-week high stood at Rs. 2636.65, while the 52-week low was recorded at Rs. 2040. As of the current market price of Rs. 2454, SRF's stock price is moderately higher than its 52-week low but below its 52-week high. Investors should carefully consider these price ranges when making investment decisions, taking into account the company's financial performance, industry trends, and overall market conditions.

Stratzy's Analysis:

SRF has a BBB rating under Stratzy's MOST framework, indicating medium fundamental risks. This suggests that while SRF has solid management, a positive outlook, and a stable trend, there are some safety concerns that investors should consider before investing.

Company's Fundamentals:

SRF (SRF: NSE), a leading chemical manufacturer, has a stock PE (Price-to-Earnings) ratio of 48.21, indicating that investors are willing to pay ₹48.21 for every rupee of earnings per share. Its PB Ratio (Price-to-Book) of 6.56 suggests that the market value of its shares is 6.56 times higher than its book value, reflecting a premium valuation compared to its assets. Despite the high PE and PB ratios, SRF's Dividend Yield of 0.3% may not be attractive to income-seeking investors, as it implies a low expected return from dividends.

Fundamental and Technical information provided in this blog were last updated on 16 Mar, 2024

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