SRF, Navin Fluorine shares surge up to 15% on reports of hike in prices of refrigerant gases

The SRF stock rallied as much as 13.8% to hit an intra-day high of ₹2,675 apiece on the National Stock Exchange of India (NSE) in morning trade. Meanwhile, Navin Fluorine shares shot up 15% to hit the day’s high of ₹4,017.1 apiece.

This is the third consecutive session of gains for both stocks. The rally was triggered after media reports said that US gas distributors had announced a price hike for refrigerant gases.

According to reports, refrigerant gas prices could go up by 200% after IGas USA, a leading American manufacturer of refrigerant gases, said that the supply of R32 and R125 has been impacted. The R32 and R125 refrigerants are used in air conditioning and low-temperature refrigeration systems.

According to analysts, earnings before interest, tax, depreciation and amortisation (Ebitda) of SRF and Navin Fluorine could increase by a decent margin on every $1 per kilogram change in realisations of the R32 refrigerant gas.

SRF has an overall capacity of 29,000 to 30,000 tonnes of the R32 and nearly 7,000 tonnes of the R125. Navin Fluorine has a capacity of close to 4,500 tonnes of the R32.

To recall, SRF management has said earlier that the company was expecting to see a better performance in the second half of the financial year 2024-25 as the overall order book remains strong.

“The Fluorochemicals Business saw healthy performance in the domestic market, with an increase in overall volumes. However, reduced export realisations put pressure on margins. The H2 performance of the fluorochemicals business is expected to improve as volumes in export markets ramp up and the domestic season kicks in,” the company said while announcing September 2024 quarter results.