SRF Ltd. has been downgraded by UBS from a 'buy' rating to a 'sell' rating due to ongoing growth challenges in its key segments. The target price for SRF shares has also been reduced to Rs 2,100, reflecting a 8.77% downside from the previous closing price of Rs 2,300.

The chemical segment, which contributes approximately 70% to SRF's EBITDA, is expected to face difficulties in meeting market expectations for recovery. The agro-chemical sector is under pressure due to declining crop prices influenced by lower US farm incomes, reduced demand from China's hog industry, and a downturn in Brazil's agro-chemical imports. The refrigerant gas segment is also facing challenges, with the US market dealing with high inventories and increased competition from Chinese and Mexican producers. UBS predicts that these factors will result in earnings cuts of 20-22% for SRF in fiscal years 2025 and 2026.