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In a regulatory filing, SRF stated that the reported price increase pertains specifically to the US market and does not directly impact their business. The company stated that price changes for refrigerant gases in its relevant market segment will continue to be determined by the forces of supply and demand, rather than external factors in the US.
“…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,” SRF said in a regulatory filing.
Also Read: SRF Q2 Results: Net profit falls by a third, margin narrows by 400 basis points
Earlier, CNBC-TV18
reported that US gas distributors announced a price hike for refrigerant gases. IGas USA said that the supply of R32 and R125 has been impacted and prices will be increased by up to 200%.
Brokerage firm Equirus in a note said that every $1 per kilogram change in realisations of the R32 refrigerant could increase SRF’s Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) by ₹260 crore.
SRF has an overall capacity of 29,000 to 30,000 tonne of the R32, while Navin Fluorine has close to 4,500 tonnes. The latter also expects to add another 4,500 tonne of capacity of the R32 by next month. SRF also has a capacity of nearly 7,000 tonne for the R125.
Also Read: SRF shares downgraded by UBS on potential ‘negative surprises’ ahead
The R32 refrigerant is used in air conditioning and low-temperature refrigeration systems. It absorbs heat and creates cool air. Similarly, the R125 is also used in air conditioning, refrigeration and other industries.
Shares of SRF Ltd ended at ₹2,672.25, up by ₹321.35, or 13.67% on the BSE.
