Why Azelis & IMCD deserve a premium Chemical Market Deep Dive

In this note we put the performance of Azelis and IMCD in perspective with the broader chemical market and private peers. Azelis and IMCD achieved superior revenue growth and best in class margin improvements (2019-2024). However, we anticipate underperformance in 2025, which we view as a temporary normalization. CSS no longer expects Azelis and IMCD to outperform (2025-2027), despite unchanged dynamics. We expect their outperformance will continue, driven by acquisition. We show how important scale is for the margins. We believe a 55-75% EV EBITDA premium is justified. This supported by their strong FCF conversion which is 40% higher compared to our peer group.