Bualuang Securities said the petrochemical sector reported standout second-quarter 2026 results, led by PTTGC and IVL, supported by sharply higher product prices and spreads. The two companies under its coverage reported combined net profit of about 18 billion baht, swinging from a net loss in the second quarter of 2025 and growing more than 44 times from the previous quarter. Combined core profit came in at 21.5 billion baht, surging 486 percent from the prior quarter. The sharp recovery was driven mainly by geopolitical tensions in the Middle East, which tightened supply and significantly boosted petrochemical revenue and product spreads. Both companies' financial positions are expected to keep reducing debt burdens, with IVL's net debt-to-equity ratio at 1.1 times while PTTGC's is low at just 0.3 times. In the second quarter of 2026, IVL generated free cash flow of 24 billion baht, while PTTGC generated 50.1 billion baht. For the third quarter of 2026, petrochemical prices and spreads are expected to soften slightly from the previous quarter as supply begins returning to the market, but price levels should remain high compared with the same period last year, so the group's core profit is expected to keep recovering and growing on a year-on-year basis. Bualuang Securities maintains an overweight rating on the sector and names PTTGC as its top pick because of stronger earnings growth prospects, cheaper valuation and a higher dividend yield. It recommends buying PTTGC with a target price of 43 baht and buying IVL with a target price of 30 baht.
PTT Global Chemical Public Company LimitedGeopolitical tensions tightened supply, boosting petrochemical prices and spreads, driving strong Q2 results and top pick status.
Indorama Ventures PCLGeopolitical tensions tightened supply, boosting petrochemical prices and spreads, driving strong Q2 results.
