The Q3 financials of PTT Global Chemical PCL (SET: PTTGC) could rebound to 1.4 billion baht of net profit from its losses in last quarter. The chemical arm of a big Thai petroleum company is expected to recover with pet-chem products sales, refinery and stock gain. Consensus set PTTGC target at 49.08 baht, as the CEO remains confident for 2024, citing an economic recovery under a tight supply.
Mr. Kongkrapan Intarajang, PTTGC’s CEO and director, explained PTTGC portfolio advantage that 2023 is a bad year for global pet-chem business as the first 9-months of 2023 financial showed. However, bio-chem, recycle products, coating resins and crosslinkers from Allnex Holding GmbH, still retain a good profit despite the falling profit on oil refinery business, due to increasing crude oil cost from middle-east conflicts.
Kongkrapan said that the pet-chem business trend will recover in 2024, after it passed the lowest point in Q2 of 2023. The CEO saw the increasing demand in Q4 of 2023 from an economic recovery and China stimulus spillovers.
He cited a global pause in new pet-chem plant investments in 2023 which will limit future global supply. And when the economy recovers next year and after, the car and EV demands will rebound which will be a positive factor to PTTGC, as the limited supply can not keep up with the spiking demands.
DAOL Securities (Thailand) estimated PTTGC’s Q3 net profit at 1.4 billion baht, which is a rebound from the loss of 13.4 billion baht in Q3 of last year, and 5.6 billion loss in last quarter. The profit recovery is due to market GRM and stock gain on refinery. DAOL’s analyst set 35 baht as a target price from Price per Book Value (P/BV) at 0.55.
Yuanta Securities (Thailand) gave a lower Q3 net profit estimate at 1.2 billion baht, citing the 3.9 billion baht stock gain, petro-chem sales, and the recovery of refinery plant after maintenance season.
The data from LSEG’s Refinitiv Consensus totaled PTTGC revenue in 2023 at 564.4 billion baht and the total Q3 revenue alone at 133.0 billion baht. The data also give 2023 net profit estimate at 1.48 billion baht and Q3 net profit at 1.31 billion baht, while the consensus from 16 brokers set the target price at 49.08 baht.
