Analysts Recommend “BUY” on IVL’s Strong 2H21 Outlook with a TP of Bt60
Three analysts gave "BUY" recommendations on IVL after reporting a significant growth in 2Q21 earnings by 50 folds.
Three analysts gave "BUY" recommendations on IVL after reporting a significant growth in 2Q21 earnings by 50 folds.
6 ส.ค. 2564

Analysts are giving “BUY” recommendations on Indorama Ventures Public Company Limited (IVL) with a target price as high as Bt60.00 per share after the company reported soaring earnings in 2Q21 by 50 folds.
 
Yesterday, IVL reported net profit of 8,340 million baht, a growth of 39% QoQ, 5,332% YoY as revenue from sale of goods increased 52% YoY to 111,301 million baht. This is mainly driven by a rebound in demand of its business segments led by major economies recovering from COVID-19 pandemic shock.
The management is aiming for similar strong growth in the second half of 2021 and in 2022 as global vaccination programs spur positive sentiment in the market.
 
Krungsri Securities (KSS) has given a “BUY” recommendation on IVL with a target price at Bt60.00 per share.
KSS stated that although PET spreads in Asia have dropped to US$200/t vs. US$240 in 1H, this has a mild impact given two-thirds of PET operations are in the west, which still has healthy margins.
KSS incorporated larger stock gains than expected and revised up spreads of all IOD products by 10% in FY21F to reflect healthy spreads. This raised its FY21F net profit by 60%. The target price implied 14.2x/18.5x FY21/22F PE.
 
Maybank Kim Eng Securities (Thailand) (MBKET) hsa given a “BUY” recommendation on IVL with a target price at Bt56.00 per share.
MBKET stated that IVL’s 1H21 core EBITDA accounted for 54% of itsFY21 forecast. Current price implies an EV/EBITDA of 9x, below historical mean of 9.6x. Macro tailwinds remain positive given government stimulus, economic recovery in the West (expected in Asia) and elevated crude. 2H21 earnings will be as strong as or better than 1H21. Management guided +7-9% higher volume HoH.
The expected softness in West PET margins (freight constraints ease) will be offset by a stronger IOD and Asian volume recovery (fiber+PET). IVL will enjoy a shale advantage following the resumption of the Lake Charles cracker in August. Management estimates the offline cracker has cost them USD90m in EBITDA (1H21). Maintain BUY. TP at THB56 (10.5x, EV/EBITDA FY21E).
 
LH Securities (LHS) has given a “BUY” recommendation on IVL with a target price at Bt50.00 per share.
LHS expected IVL’s to continue its strong business potential, even though the share price was 19% down from its three-month high, which could be due to a selloff from Thai investors as the data showed continuous buying pressure from foreign investors and NVDR.
LHS estimated IVL to report strong earnings in 2H21 and the share price is at an attractive value. The upgraded target price to Bt50.0.0 per share was based on FY21 P/B 2.15x, 0.5 S.D. 10-year average.
In addition, the analyst stated that further M&amp;A deal and a increase capital (if any) could be a downside risk, similarly to PTTGC and TOP.
 