Thai PTT Chem seen to post 81% surge in 2010 profit - DBS

20 September 2010 10:07  [Source: ICIS news]

SINGAPORE (ICIS)--PTT Chemical is projected to post an 81% annual surge in net profit this year to Thai baht (Bt) 12.29bn ($400m, €308m), with its major projects freed up form court injunction early this month, DBS Vickers Securities said on Monday.

The company should be able to operate its new 300,000 tonne/year high density polyethylene (HDPE) plant in the fourth quarter, which could boost this year’s earnings, the brokerage said in a research note.

Also included in the 74 projects that were unfrozen by the court was the 6th gas separation plant PTT, which would provide the feedstock for PTT Chemical’s new cracker in Mab Ta Phut.

PTT is the parent firm of PTT Chemical, which is Thailand’s largest ethane-based petrochemical producer.

Once operational, the gas separation plant would allow PTT Chemical to raise its average utilization rate at the new cracker to 80% in the second half of the year from the current 60%, DBS Vickers said.

The benefits would trickle down to PTT Chemical’s other downstream polymer operations, in terms of higher production volumes, the brokerage said.

Meanwhile, PTT was reported to be working on a $300 merger and acquisition deal to produce specialty products, DBS Vickers said.

No further details were available on the deal but it should help PTT Chemical improve its margins and reduce its exposure to the petrochemical “downcycle”, given that margins of specialty products are more sustainable, it added.

 ($1 = €0.77, Bt30.73)

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By: Nurluqman Suratman

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